- Important insight: JPMorganChase attributed the growth of its tokenized money market fund to stablecoin issuers parking reserves on-chain to generate income, as the GENIUS Act prohibits them from paying interest directly to token holders.
- Supporting data: The fund has $693 million in assets, more than double what it had at the end of May.
- Looking ahead: The company expects growth could moderate from the current pace, but said the fund is well positioned to absorb reserve assets if the GENIUS Act pushes more issuers into fully reserved products.
Jamie Dimon may always be a little negative about the crypto industry, but his bank continues to court it.
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JPMorganChase’s OnChain Liquidity token money market fund currently has $693 million in assets, with its holdings more than doubling in June alone. The Curated Stablecoin Vault launched in May as a place for stablecoin issuers to store their customers’ money.
The tokenized money market fund is a result of the GENIUS Act, which imposes reserve requirements on stablecoin issuers. Generally, in crypto, a vault is a non-custodial smart contract that pays out tokens. While JPMorgan Although the offering is nominally a “vault,” it actually pays interest to stablecoin issuers, who are prevented by legislation from earning their own interest.
JPMorgan filed for registration with the U.S. Securities and Exchange Commission on May 12, describing plans for the fund to maintain blockchain-based token balances tied to investors’ ownership records, with approved U.S. users able to submit purchase, redemption and transfer requests via Ethereum.
The fund – JPMorgan’s second tokenized money market fund – is “very well positioned to capture a good portion of the asset base that will come to market,” said Paul Przybylski, JPMorgan’s global head of products, digital and tokenized assets. Its rapid growth has been fueled by stablecoin issuers, he said, and the bank expects continued demand from both issuers and crypto natives.
While the company doesn’t expect continued growth in the “stratospheric status, 250% month-over-month risk range,” Przybylski noted that he expects the GENIUS Act to push more issuers into fully reserved products.
JPMorgan has launched its My Onchain Net Yield Fund or MONY – also on the public Ethereum blockchain – as a private placement fund that will allow investors to earn US dollar returns in December 2025.
According to JPMorgan spokeswoman Kristen Chambers, the fund provides these issuers with compliant on-chain reserve assets. The GENIUS Act prohibits stablecoin issuers from paying interest on their stablecoins, she said, so issuers “park government reserves in vehicles like.” [the fund] to generate revenue while remaining compliant.”
The Fund’s holdings are limited to U.S. Treasuries and Treasury or cash-backed overnight repos. It runs on JPMorgan’s Kinexys Digital Assets blockchain infrastructure, with access limited to the Morgan Money platform and a minimum investment of $1 million required.
Przybylski said the company is “uniquely positioned” to launch an SEC-compliant money market fund under the GENIUS Act, noting that its competitors are “predominantly private placement vehicles based in the Cayman Islands or the British Virgin Islands.”
“We had a huge appetite for it from customers [MONY]“But we always wanted to bring a fully registered vehicle,” Przybylski said.
Financial and crypto markets have embraced tokenization – the conversion of traditional financial assets into blockchain-based representations – to reduce settlement times, increase transparency and enable 24/7 trading and use of collateral. In the past year, major institutions including BlackRock, Franklin Templeton and Goldman Sachs have launched or tested tokenized funds.
Still, it’s a strange market for JPMorgan. According to the website Trading Strategy, Janus Henderson is the largest stablecoin vault curator with assets of $3.7 billion. After Janus, Steakhouse Financial, Spark, Sentora and Gauntlet are the next four, while JPMorgan is in sixth place.
In his April 6 letter to shareholders, JPMorganChase CEO Jamie Dimon highlighted competitive pressures for traditional institutions to move upstream. He emphasized the need for his company to “introduce our own blockchain technology and continually focus on what our customers want in great detail.”
“While we have been able to grow, many, but not all, of the new players have been quite successful and continue to raise both money and their ambitions,” Dimon wrote. “A whole new set of competitors is emerging based on blockchain, including stablecoins, smart contracts and other forms of tokenization.”
https://www.americanbanker.com/news/jpmorganchases-tokenized-money-market-fund-vaults-ahead
