Nikolas Sargeant
TL;DR
-
JPMorgan has launched its second tokenized money market fund on Ethereum.
-
The new “OnChain Liquidity-Token Money Market Fund” will invest in U.S. Treasurys and overnight repurchase agreements collateralized by Treasurys or cash.
JPMorgan is launching a tokenized money market fund designed to help stablecoin issuers meet the reserve requirements under the GENIUS Act, according to a filing made on Tuesday.
Fund Details and Investment Strategy
The new fund, tokenized on the Ethereum blockchain, will invest in U.S. Treasurys and overnight repurchase agreements, which are collateralized by Treasurys or cash. JPMorgan has named the fund the "OnChain Liquidity-Token Money Market Fund," which will trade under the ticker symbol JLTXX.
JPMorgan stated that the blockchain technology behind the fund will be managed by its business unit, Kinexys Digital Assets.
The Ethereum blockchain is currently the only blockchain used by the fund, though JPMorgan anticipates expanding to other blockchains in the future.
The SEC filing for JLTXX became effective on May 13, though JPMorgan has not disclosed a specific launch date for the fund.
JPMorgan's Second Tokenized Money Market Fund on Ethereum
This new fund marks JPMorgan’s second tokenized money market fund launched on the Ethereum blockchain. The first, the MONY fund, was launched late last year and was aimed at institutional investors seeking on-chain cash management products.
The new JPMorgan fund resembles a similar stablecoin reserve-focused money market fund launched by Morgan Stanley last month, although Morgan Stanley’s product does not operate on blockchain rails. Franklin Templeton has also released a tokenized money market fund known as BENJI.
GENIUS Act and Stablecoin Reserve Requirements
As part of the GENIUS Act, U.S.-compliant stablecoin issuers are required to back their tokens with highly liquid assets, including U.S. Treasurys, cash, and insured bank deposits. JPMorgan’s OnChain Liquidity-Token Money Market Fund aims to meet these requirements for stablecoin issuers.
Data from RWA.xyz reveals that the tokenized real-world asset market has grown to approximately $32.2 billion as of May 12, with tokenized U.S. Treasury products accounting for the largest share at around $15.9 billion.
JPMorgan believes that the market for real-world assets could reach $13 trillion as soon as 2030, more than 500 times the market size today.
