TLDR
- Goldman & BNY launch tokenized funds, bridging blockchain and finance
- Tokenized money market funds unlock 24/7 liquidity and faster settlements
- BNY & Goldman modernize fund access with blockchain-based subscriptions
- Blockchain meets money markets: GS DAP enables real-time fund transfers
- New tokenized fund system blends yield, speed, and regulatory compliance
Goldman Sachs and Bank of New York Mellon have jointly launched tokenized money market funds for institutional use. The initiative enables subscriptions and redemptions to be shared through BNY’s LiquidityDirect platform using Goldman’s blockchain system, GS DAP. This move signals a significant push toward integrating traditional assets into a 24/7 digital environment.
JUST IN: Goldman Sachs partners with BNY to launch digital tokens backed by money market funds. pic.twitter.com/cUo7WuMsFO
— Bitcoin Junkies (@BTCjunkies) July 23, 2025
Clients can access money market funds with ownership recorded on blockchain, enabling faster settlements and automated processing. BNY serves as the shareholder recordkeeper while also managing the minting and burning of mirror tokens. This dual-record structure ensures compliance with existing regulations while offering blockchain benefits.
Several major asset managers joined the rollout, including BlackRock, Fidelity Investments, Federated Hermes, and the asset arms of Goldman and BNY. These firms offer eligible share classes through the tokenized framework, broadening market access and functionality. The program marks a critical step in modernizing fund infrastructure.
Tokenization Expands Money Market Utility
Tokenized money market funds offer near-instant transferability, removing traditional friction in cash movements and settlements. These funds, backed by short-term government securities and similar instruments, typically serve as cash equivalents with a yield. By digitizing them, Goldman and BNY unlock round-the-clock usage and real-time transaction capabilities.
The project enables mirrored token shares that function alongside traditional records, bridging digital and legacy systems. The system improves fund mobility and retains compliance with current operational norms. This dual setup also supports use as collateral in trades, further enhancing financial efficiency.
McDermott of Goldman Sachs highlighted the potential to reduce capital tied up in slow-moving collateral. By transferring tokens instead of cash, firms can move faster while cutting operational delays. This creates new value in assets previously limited by manual processes and market hours.
Stablecoin Legislation Drives Blockchain Adoption
The launch follows the recent GENIUS Act, which established a U.S. framework for regulated stablecoins. Market participants expect the law to accelerate blockchain adoption, particularly in payments and cash management. Major banks including JPMorgan, Citigroup and Bank of America are exploring similar applications.
Stablecoins, pegged to the U.S. dollar, support 24/7 liquidity but typically lack yield. Tokenized money market funds provide an alternative that offers both liquidity and income. These instruments complement each other, enabling financial operations to evolve with blockchain rails.
BNY’s LiquidityDirect now connects directly to GS DAP, allowing clients to manage liquidity using blockchain without disrupting existing operations. The banks view tokenization as a foundational step toward broader use of digital assets. Their solution integrates seamlessly with current infrastructure while enabling future growth in financial efficiency.
