- Fidelity Investments is in advanced testing stages for its stablecoin, expanding its presence in the competitive digital asset market.
- The U.S. government is pushing stablecoin regulations, with President Trump urging lawmakers to pass a regulatory bill before August.
- Fidelity has filed with the SEC for a tokenized Treasury fund, positioning itself alongside BlackRock and Franklin Templeton in digital finance.
Fidelity Investments is preparing to launch its stablecoin, expanding its presence in the cryptocurrency market. The asset management firm is in the final testing stages of its digital token and is expected to introduce it soon.
Fidelity’s stablecoin will compete with other digital assets such as Ripple’s RLUSD and Tether USDT. The company is positioning itself in a growing stablecoin sector, which has seen increasing interest from financial firms. Moreover, Fidelity recently filed to launch a tokenized U.S. money market fund, directly competing with BlackRock and Franklin Templeton.
Stablecoin Designed for Digital Markets
Two individuals familiar with the project revealed that Fidelity’s stablecoin aims to serve as a digital cash equivalent in crypto markets. The stablecoin will be managed through Fidelity’s digital assets division, aligning with the firm’s broader strategy to expand in blockchain-based financial products.
Regulatory Developments Shape the Stablecoin LandscapeFidelity is moving forward with its stablecoin initiative as the U.S. government works on a comprehensive regulatory framework for digital assets. President Donald Trump emphasized at the White House Crypto Summit on March 7 that he expects lawmakers to pass a stablecoin regulatory bill before the August congressional recess.
U.S. Government Backs Stablecoin Growth
U.S. Treasury Secretary Scott Bessent stated that stablecoins will play a key role in maintaining the U.S. dollar’s status as the global reserve currency. He also mentioned that the Treasury would collaborate with the Office of the Controller of the Currency and the IRS to eliminate regulations that hinder the digital asset market.
Federal Reserve Governor Christopher Waller noted in February that U.S. dollar-denominated stablecoins strengthen the dollar’s global reserve status. He emphasized that nearly 99% of stablecoin market capitalization is linked to the U.S. dollar. Federal Reserve Chair Jerome Powell also stated in June 2023 that stablecoins are a form of money and require strong federal oversight.
Fidelity has also submitted a filing with the U.S. Securities and Exchange Commission (SEC) to register its tokenized Treasury fund, the Fidelity Treasury Digital Fund (FYHXX). The fund, launched last year, holds U.S. Treasury securities and cash while using blockchain as a transfer agent.
Blockchain Integration in Financial Markets
The SEC filing indicated that the OnChain share class of FYHXX currently operates on the Ethereum blockchain. Fidelity may expand the fund’s blockchain capabilities in the future, pending regulatory approval. The firm expects the product to become effective on May 30.
Cynthia Lo Bessette, Fidelity’s Head of Digital Asset Management, emphasized that tokenization can enhance capital market efficiency. She highlighted that tokenized assets could be used as collateral to meet margin requirements in trading.
Fidelity is joining a competitive market for tokenized U.S. Treasuries. BlackRock’s BUIDL fund, launched with Securitize last year, has emerged as a leader with nearly $1.5 billion in assets. Franklin Templeton’s fund, established in 2021, manages around $689 million.
