State Street's Milrod at RBC Conference
State Street's Chief Product Officer Donna Milrod spoke recently at the 2026 RBC Capital Markets Global Financial Institutions Conference. She comments, "Tokenization is a key focus, offering benefits like fractional ownership and near-instant settlement, with initial products including tokenized money market funds. Why money market tokenization first? Well, I'd say there's three real benefits, and they have real commercial value to our client base. The first is what's going on in stablecoins. Money market funds are a natural cash equivalent for stablecoins. Right now, they cannot earn interest. Also, stablecoins are really used ... for crypto transactions, so there's a lot of rhetoric in the market about stablecoins being used for payment rails. That isn't really true yet, but that will come. Really, if you think about the opportunity for stablecoins investing in money funds, they will then earn interest. That's clearly one use case that has real commercial value.... The second use case is really about distribution. This allows money market fund sponsors to reach digitally native investors. There's an opportunity there. Think of that as another wrapper, just like an ETF or a mutual fund. We know wrappers. Like, we're the number one servicer in ETFs. We know a thing or two about this. We bring our expertise to the market there. The third use case is really about using these tokens as collateral." She also says, "If you think back to 2022, with the U.K. gilt crisis, that turned into an LDI crisis. That was really because as counterparties needed to post more collateral, they had to liquidate their money funds to get to the underlying assets, and that just took time, and therefore they, you know, that just made the crisis that much worse. If they were able to post tokens of their money funds, which were just a representation of the same value, we would not have had such a deep crisis." Milrod adds, "If you think about the opportunity, you know, you have a $10 trillion money market mutual fund market, [and] in terms of what's been tokenized so far, it's less than $1 billion or right around $1 billion. Just 1% change is, you know, pretty enormous. There's, like, plenty of room to grow. In terms of that first use case on stablecoins, there's about $300 ... billion in stablecoins out there. The prediction is that that will go quickly to $500 billion in the next couple of years on its way to, you know, almost $3 trillion in five years. That's all without paying interest. Imagine if you can provide a vehicle that will pay interest. You can see an enormous explosion in this money market tokenization world."
