Goldman Sachs and BNY Mellon Launch Tokenized Money Market Fund Platform for Institutional Clients

Highlights:

• Goldman Sachs and BNY Mellon launch a platform for tokenized fund shares on a private blockchain network.
• Tokenized money market funds offer real-time access and yield while using low-risk assets like US Treasuries.
• Institutions can now manage idle capital with faster settlements and fewer delays through digital fund shares.

Goldman Sachs and BNY Mellon have introduced a platform that gives institutional clients access to tokenized money market funds. This platform allows BNY Mellon clients—including hedge funds, corporate treasurers, and pension firms—to invest in fund shares recorded directly on Goldman Sachs’ private blockchain. BlackRock, Fidelity, Federated Hermes, and asset management outfits of both Goldman and BNY Mellon, among other key actors, have all backed the project.

BNY’s LiquidityDirect and @GoldmanSachs’ Digital Asset Platform have collaborated to launch tokenized money market funds (MMFs). 🤝

This significant initiative sets our clients on a path to access a new capability to increase the utility and potential transferability of MMFs in… pic.twitter.com/WJ1lv7m6T4

— BNY (@BNYglobal) July 23, 2025

The new platform aims to make investments easier and exclude the time-consuming elements of traditional financial systems. Investors can receive tokenized funds in real time instead of waiting out the market hours or multi-day settlement periods. The blockchain ledger enables instant verification of ownership and supports secure, around-the-clock transactions. This system improves transparency and reduces the number of steps required to manage fund ownership.

Laide Majiyagbe, the head of liquidity, financing, and collateral at BNY Mellon, suggests that the financial landscape is moving toward more digital tools that can enable richer and quicker flows. She pointed out that the transition requires developing scalable and secure infrastructure.

Digital Cash Management Tools Gain Traction Among Institutional Clients

The advantages of tokenized money market fund shares are distinct compared to stablecoins. Stablecoins do not yield any interest and instead maintain a fixed value, whereas tokenized shares could provide yield. These are often secured by low-risk securities such as US Treasurys, repurchases, or commercial paper. This renders them appealing to institutional investors seeking safe and flexible means to store idle funds.

Investors will have access to their money in real time, which was not the case in traditional money market products, which operate within actual business hours. Tokenized shares provide liquidity at all times, which improves access and reduces the need for intermediaries. The shares can also be fractionalized. This allows investors to purchase smaller amounts without the limitations of full share pricing.

In March 2024, Goldman Sachs and BNY Mellon took part in a pilot on the Canton Network, along with other banks, asset managers, custodians, and exchanges. The test showed how tokenized assets could be settled across various systems more efficiently. It included 15 asset managers, 13 banks, four custodians, and three exchanges. Meanwhile, Ripple recently selected BNY Mellon as the major custodian of its stablecoin RLUSD.

Institutions are now exploring how tokenized assets could become part of their regular operations. Real-time settlement is expected to lower risk and improve how cash and assets move between parties. That change may reshape how institutions manage liquidity and conduct large transactions across global markets. According to Koyfin, a financial data and analytics platform, there is $7.4 trillion sitting in money market funds.

There is $7.4 trillion sitting in Money Market Funds right now. pic.twitter.com/3BSGlZOUE1

— Koyfin (@KoyfinCharts) July 22, 2025

Tokenized Money Market Funds Set Stage for Real-Time Settlement Future

Tokenized MMFs may play a growing role in the financial strategies of major institutions. These funds can act as a bridge between traditional finance and digital asset systems. Institutions may use them as collateral without the need to convert back to cash.

Executives from both Goldman Sachs and BNY Mellon expect these digital instruments to improve transaction speed and asset movement. Goldman’s Mathew McDermott said that tokenization introduces utility in areas where it has not existed. He added that the scale of the money market fund space offers new opportunities for improving how assets are used and transferred.