Fidelity Investments has reportedly been running a low key pilot program of its own stablecoin. The move signals an aggressive step towards a greater involvement in the digital currency economy. Fidelity Investments’ entry into the stablecoin industry could be a major shift for institutional investors who are embracing blockchain-based financial services.
Sources familiar with the situation claim that the fund giant has advanced to the testing stage of a digital coin intended to function as cash on crypto markets. The stablecoin is still being developed and not named by Fidelity Digital Assets. This division focuses on crypto. The pilot is still very secretive, and many of its details remain a mystery.
Fidelity has not made it clear whether they plan to make the stablecoin available to the general public, or only for institutions. The stablecoin would compete directly with other market leaders such as Tether and Circle. Their USDT and USDC tokens are dominant in the stablecoin space. Even if the initiative is limited to institutions, it could have a significant impact on how large investors engage with tokenized markets.
It is interesting to note the timing. Fidelity submitted a proposal to the U.S. Securities and Exchange Commission just days before the news about the pilot stablecoin surfaced. “OnChain” Fidelity Treasury Money Market Fund has a share class. This share class represents ownership of the fund shares in Ethereum, which allows for real-world financial product to be operated on decentralized infrastructure.
If approved, this tokenized version of the fund—called the Fidelity Treasury Digital Fund—will give institutional investors the ability to hold and transfer fund shares on-chain, with all the benefits of blockchain such as real-time settlement, transparency, and increased liquidity. The launch is tentatively scheduled for May 30th, 2025.
Fidelity’s move reflects a larger trend in the traditional finance world: The push to tokenize assets. Asset tokenization involves the conversion of ownership rights for physical financial instruments or other traditional assets into digital tokens stored on blockchain. It’s a growing market, and according to data from rwa.xyz, tokenized U.S. Treasury debt now accounts for $4.8 billion in value—second only to private credit among tokenized real-world asset classes.
BlackRock and Franklin Templeton are among the major players that have already made their presence known. BlackRock’s BUIDL tokenized fund and Franklin Templeton’s Benji Investments are two early examples of how traditional asset managers can leverage blockchain technology to create better financial instruments.
These developments, while primarily geared towards institutional investors in mind, may open the door to a broader access of tokenized assets for the public. The stablecoins in particular are viewed as the key bridge that connects traditional financial systems with decentralized ones. The ability of stablecoins to keep a constant value when transacting over blockchain rails is what makes them perfect for on-chain liquidity, payments and settlements.
Clarity in the regulatory framework is improving. U.S. Government, during the current Administration, is showing increasing support to regulated stablecoins. The President has called on the development of stablecoins backed by the dollar, as they are a way to maintain the value of the U.S. Dollar in the global market. The shift in attitude is notable and may allow institutions such as Fidelity, to be more innovative with less legal uncertainty.
Fidelity’s stablecoin test and push to tokenize funds shows how seriously it takes blockchain. While the firm has long been bullish on crypto—offering Bitcoin custody and investment services since 2018—these latest moves suggest a deeper commitment to building infrastructure that integrates traditional finance with decentralized networks.
Fidelity’s public launch would shake the stablecoin ranking and lend credibility to digital money of institutional grade. Even a small, institutional stablecoin would help Fidelity streamline its internal ecosystem, as well as the liquidity of their broader clients.
Fidelity, in an ever-changing landscape, is positioning itself to be a possible leader for the next generation financial infrastructure. Whether it’s through a stablecoin, tokenized funds, or further blockchain initiatives, Fidelity’s moves are a strong signal that tokenization is no longer a fringe idea—it’s fast becoming the foundation of modern finance.
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Source: cryptocoin.news
