Wall Street Goes Full Crypto: Goldman and BNY Mellon Tokenize Money Market Funds

In another sign that Wall Street isn’t just flirting with blockchain anymore, Goldman Sachs and BNY Mellon are rolling out a new tokenization project aimed at institutional investors.

The two financial giants are teaming up to offer tokenized money market funds (MMFs), allowing clients to hold and transfer shares using blockchain infrastructure.

This move is being positioned as a stepping stone toward real-time finance and greater market efficiency, and it’s already drawing big-name participants.

A blockchain-Based liquidity bridge for Wall Street

At the heart of this initiative is Goldman Sachs’ private blockchain, GS DAP®, which will serve as the infrastructure for creating mirror tokens that represent MMF shares.

BNY Mellon will maintain the official records of ownership while enabling blockchain-based tokens that mirror those shares. This hybrid setup ensures compliance with existing financial regulations while opening up new possibilities for asset utility.

Initial participants in the rollout include BlackRock, Federated Hermes, Fidelity Investments, and the asset management arms of both Goldman Sachs and BNY Mellon.

These firms will allow clients to subscribe and redeem MMF shares using BNY Mellon’s LiquidityDirectSM platform, now integrated with GS DAP®.

The blockchain integration lets institutional clients view and manage their investments in a more flexible way, even outside regular market hours.

Tokenized funds: yield without the stablecoin risk

Unlike stablecoins, which just got hit with regulatory constraints under the GENIUS Act banning interest-bearing versions, tokenized MMFs offer yield and regulatory clarity.

That makes them appealing to hedge funds, pensions, and corporates looking to manage cash without taking on excessive volatility.

According to Goldman’s global head of digital assets, Mathew McDermott, this could pave the way for MMF tokens to be used as collateral in future financial operations.

BNY’s Laide Majiyagbe added that this initiative marks a “first-of-its-kind” use case that blends traditional custody with digital asset innovation.

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