Moody’s awards top rating to Fidelity and BlackRock's tokenized money market funds

The AAA rating signals the highest level of credit quality, liquidity and capital preservation.

What to know:

• Moody’s awarded its top rating, AAA-mf, to tokenized money market funds issued by Fidelity and BlackRock, signaling the highest levels of credit quality, liquidity and capital preservation.
• Fidelity’s FILQ fund, introduced on May6 and built on Sygnum’s Desygnate tokenization platform with infrastructure support from JPMorgan Chase, Apex Group and Chainlink, aims to enable real-time, onchain cash settlement.
• Tokenized U.S. government debt products have surged to more than $15 billion in assets under management from $1 billion in two years, with BlackRock’s BUIDL fund accounting for about 15% of the market.

Moody’s assigned its highest credit rating to tokenized money market funds from Fidelity and BlackRock, validating their safety as yield-bearing onchain products.

The AAA-mf rating signals an extremely strong ability to ensure high liquidity and capital preservation and the lowest level of risk.

Fidelity's FILQ fund debuted on May 6. The product is powered by Swiss digital asset bank Sygnum's Desygnate tokenization platform, which enables onchain fund registries, smart contract-based settlement and stablecoin subscriptions and redemptions.

It also includes infrastructure support from JPMorgan Chase for custody and fund administration, Apex Group for transfer agency services and Chainlink, which publishes the fund’s net asset value and distribution data onchain.

"There is no tokenized finance without tokenized liquidity. Once markets settle in real time, cash must settle in real time too," Emma Pecenicic, head of digital assets distribution at Fidelity International, said in a statement.

BlackRock's BUIDL, introduced in March 2024, is one of the largest tokenized Treasury funds in the world. The fund received a AAA rating yesterday, more than two years after its debut, according to a post on X by Securitize, its transfer agent and tokenization platform.

Money market funds deal in high-liquidity, short-term debt securities with maturities generally under one year, such as Treasury bills, commercial paper, and certificates of deposit. Investors use money market funds as a safe place to park cash while still earning some interest.

Tokenized U.S. government debt products, including Treasury bills, notes, bonds and money market funds, have rapidly gained traction among both traditional financial institutions and crypto-native firms.

The onchain tokenized Treasury sector now has total assets under management of over $15 billion, up from $1 billion in just two years, according to data source rwa.xyz. The growth is driven by demand for onchain versions of low-risk, yield-bearing instruments.

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