Link of The Day
Bloomberg Says Firms Build Buffers
Bloomberg recently published two news pieces involving money market funds. The first, "Funding Markets Show Dash for Cash as Firms Build Buffers," tells us, "Recent activity in funding markets shows a quiet push by financial institutions to build up buffers that would help protect against any credit meltdowns or market distress, a sign they perceive rising risks even as overall conditions remain stable for now. A cluster of indicators -- from increases Federal Home Loan Bank lending to shifts in money‑market fund allocations -- all suggest that institutions, at the margins, are positioning themselves more defensively and are in some cases paying up to do so.... These shifts aren't about any current strains: There's no stress evident in headline indicators such as rates on overnight repurchase agreements, and the Federal Reserve has been regularly buying Treasury bills to make sure reserves in the banking system are ample. It's more about individual institutions ensuring they have enough cash if conditions worsen, against a backdrop of mounting worries around private credit and broader economic unease." The other article, "Freed From US Punishment, Wells Fargo Bolsters the Repo Market," states, "When Wells Fargo & Co. was finally freed last year from a US‑imposed cap on its assets, the bank went looking for places to deploy its pent‑up financial power. Much of it flowed into overnight repurchase agreements -- the repo market -- just as the broader financial system was looking for another deep‑pocketed player. Since the cap came off, Wells Fargo has pushed more than $200 billion into this key piece of the financial system's plumbing, which links money‑market funds, dealers and Treasuries. Regulators have been warning about strains in this market, and in June -- the same month Wells Fargo was freed -- the Federal Reserve floated rule changes to make it easier for big banks to step in." The former article also says, "Money‑market funds shifted out of Treasuries and cash in February and moved into agency debt and repo, a rotation that aligns with the pickup in agency issuance driven by demand for FHLB advances and mortgage purchases, according to Bank of America Corp. strategists. Holdings of Treasury bills fell by $204 billion last month, even as the Treasury was ramping up supply to prefund tax refunds. That drop far exceeded the roughly $55 billion of bills the Fed purchased over the same period." Meanwhile, the second article adds, "At the beginning of 2023, direct exposure between money funds and Wells Fargo as primary dealer was minimal, according to JPMorgan's Ho. In May 2025, before the cap was removed, it was about $90 billion, Crane Data show. That ballooned to around $165 billion by the final quarter. The surge underscored how much demand there was for another player with balance-sheet capacity -- and how quickly the market absorbed it."
Weekly Money Fund Portfolio Holdings
Crane Data published its latest Weekly Money Fund Portfolio Holdings statistics Tuesday, which track a shifting subset of our monthly Portfolio Holdings collection. The most recent cut (with data as of March 27) includes Holdings information from 62 money funds (down 5 from a week ago), or $4.219 trillion (up from $4.215 trillion) of the $8.208 trillion in total money fund assets (or 51.4%) tracked by Crane Data. (Note: Our Weekly MFPH are e-mail only and aren't available on the website. See our latest Monthly Money Fund Portfolio Holdings here and our March 11 News, "March MF Portfolio Holdings: Assets, Treasuries, Repo & Agencies All Up.") Our latest Weekly MFPH Composition summary shows Government assets dominating the holdings list with Treasuries totaling $1.977 trillion (up from $1.941 trillion a week ago), or 46.9%; Repurchase Agreements (Repo) totaling $1.516 trillion (up from $1.484 trillion a week ago), or 35.9%, and Government Agency securities totaling $410.5 billion (up from $397.8 billion a week ago), or 9.7%. Commercial Paper (CP) totaled $137.9 billion (down from $171.8 billion a week ago), or 3.3%. Certificates of Deposit (CDs) totaled $76.8 billion (down from $92.7 billion a week ago), or 1.8%. The Other category accounted for $60.0 billion or 1.4%, while VRDNs accounted for $40.1 billion or 1.0%. The Ten Largest Issuers in our Weekly Holdings product include: the US Treasury with $1.978 trillion, Fixed Income Clearing Corp with $556.8B, the Federal Home Loan Bank with $233.9B, JP Morgan with $151.6B, RBC with $105.5B, Citi with $104.1B, Federal Farm Credit Bank with $100.8B, BNP Paribas with $92.5B, Wells Fargo with $80.1B and Bank of America with $57.5B. The Ten Largest Funds tracked in our latest Weekly include: JPMorgan US Govt MM ($318.0B), JPMorgan 100% US Trs MM ($313.0B), Goldman Sachs FS Govt ($277.6B), Fidelity Inv MM: Govt Port ($276.1B), State Street Inst US Govt ($225.7B), Morgan Stanley Inst Liq Govt ($217.3B), BlackRock Lq FedFund ($188.8B), BlackRock Lq Treas Tr ($175.7B), Fidelity Inv MM: MM Port ($168.3B) and Dreyfus Govt Cash Mgmt ($160.8B). (Let us know if you'd like to see our latest domestic U.S. and/or "offshore" Weekly Portfolio Holdings collection and summary.)
Money Fund Yields Flat at 3.47%
Money fund yields (7-day, annualized, simple, net) were unchanged at 3.47% on average during the week ended Friday, March 27 (as measured by our Crane 100 Money Fund Index), after remaining unchanged the week prior. Fund yields haven't been below 3.5% since November 2022, and they are down from a recent high of 5.20% in November 2023. They should remain flat in coming days (and weeks) since the Fed left short-term rates unchanged two weeks ago. Yields were 3.58% on 12/31/25, 3.78% on 11/30, 3.90% on 10/31, 3.94% on 9/30, 4.11% on 8/31, 4.12% on 7/31, 4.13% on 6/30, 4.14% on 3/31/25 and 4.28% on average on 12/31/24. MMFs averaged 4.75% on 9/30/24, 5.10% on 6/28/24, 5.14% on 3/31/24 and 5.20% on 12/31/23. The broader Crane Money Fund Average, which includes all taxable funds tracked by Crane Data (currently 682), shows a 7-day yield of 3.37%, unchanged in the week through Friday. Prime Inst money fund yields were unchanged at 3.59% in the latest week. Government Inst MFs were unchanged at 3.46%. Treasury Inst MFs were unchanged at 3.43%. Treasury Retail MFs currently yield 3.20%, Government Retail MFs yield 3.18% and Prime Retail MFs yield 3.37%, Tax-exempt MF 7-day yields were down 1 bp to 2.09%. Money market mutual fund assets have paused since hitting a record high of $8.280 trillion on March 18, according to our Money Fund Intelligence Daily. Assets have fallen $54.7 billion in the week through Friday, and they've decreased by $32.9 billion in March month-to-date (through 3/27). MMF assets increased by $99.5 billion in February, $32.9 billion in January, $126.3 billion in December, $132.8 billion in November, $142.1 billion in October, $105.2 billion in September and $132.0 billion in August. They rose by $63.7 billion in July, $6.7 billion in June and $100.9 billion in May. But MMFs decreased $24.4 billion in April and increased by $2.8 billion last March. Weighted average maturities were at 43 days for the Crane MFA and 44 days the Crane 100 Money Fund Index. According to Monday's Money Fund Intelligence Daily, with data as of Friday (3/27), just 162 money funds (out of 792 total) yield under 3.0% with $202.6 billion in assets, or 2.5%, while the vast majority (630) of funds yield between 3.00% and 3.99% ($8.006 trillion, or 97.5%). No funds yield over 4.0%. Our Brokerage Sweep Intelligence Index, an average of FDIC-insured cash options from major brokerages, was unchanged at 0.30%, after falling 1 basis point fourteen weeks prior. The latest Brokerage Sweep Intelligence, with data as of March 27, shows no changes over the past week. Four of the 10 major brokerages tracked by our BSI offer rates of 0.01% for balances of $100K (and lower tiers). These include: E*Trade, Merrill Lynch, Morgan Stanley and Schwab.
MMFs in Retirement Plans Break $1 Tril.
The Investment Company Institute published, "Retirement Assets Total $49.1 Trillion in Fourth Quarter 2025," which includes data tables showing that money market funds held in retirement accounts jumped to $1.016 trillion (up from $988 billion) in the latest quarter, accounting for 13% of the total $7.746 trillion in money funds. MMFs represent just 6.9% of the total $14.7 trillion of mutual funds in retirement accounts. The release says, "Total US retirement assets were $49.1 trillion as of December 31, 2025, up 2.1 percent from September. Retirement assets accounted for 34 percent of all household financial assets in the United States at the end of December 2025. Assets in individual retirement accounts (IRAs) totaled $19.2 trillion at the end of the fourth quarter of 2025, an increase of 1.7 percent from the end of the third quarter of 2025." It continues, "Defined contribution (DC) plan assets were $14.2 trillion at the end of the fourth quarter, up 1.7 percent from September 30, 2025. Government defined benefit (DB) plans—including federal, state, and local government plans -- held $10.0 trillion in assets as of the end of December 2025, a 4.5 percent increase from the end of September 2025. Private-sector DB plans held $3.1 trillion in assets at the end of the fourth quarter of 2025, and annuity reserves outside of retirement accounts accounted for another $2.6 trillion." The ICI tables show money funds accounting for $772 billion, or 10%, of the $7.402 trillion in IRA mutual fund assets and $244 billion, or 3%, of the $7.336 trillion in defined contribution plan holdings. Money funds in 401k plans totaled $163 billion, or 3% of the $5.816 trillion of mutual funds in 401k's.
ICI: Assets Plunge in Latest Week
The Investment Company Institute published its weekly "Money Market Fund Assets" report Thursday, which shows money fund assets decreasing by $53.0 billion to $7.803 trillion, after rising by $38.7 billion to a record high $7.856 trillion the previous week. Assets have risen in 21 of the last 27 weeks and 29 of the past 36 weeks. MMF assets are up by $789 billion, or 11.3%, over the past 52 weeks (through 3/25/26), with Institutional MMFs up $546 billion, or 13.2% and Retail MMFs up $243 billion, or 8.5%. Year-to-date in 2026, MMF assets are up by $70 billion, or 0.9%, with Institutional MMFs up $38 billion, or 0.8% and Retail MMFs up $32 billion, or 1.0%. ICI's weekly release says, "Total money market fund assets decreased by $53.01 billion to $7.80 trillion for the week ended Wednesday, March 25, the Investment Company Institute reported.... Among taxable money market funds, government funds decreased by $58.25 billion and prime funds increased by $4.27 billion. Tax-exempt money market funds increased by $968 million." ICI's stats show Institutional MMFs decreasing $59.4 billion and Retail MMFs increasing $6.4 billion in the latest week. Total Government MMF assets, including Treasury funds, were $6.411 trillion (82.2% of all money funds), while Total Prime MMFs were $1.248 trillion (16.0%). Tax Exempt MMFs totaled $144.1 billion (1.8%). It explains, "Assets of retail money market funds increased by $6.41 billion to $3.11 trillion. Among retail funds, government money market fund assets increased by $5.38 billion to $1.97 trillion, prime money market fund assets decreased by $192 million to $1.01 trillion, and tax-exempt fund assets increased by $1.22 billion to $130.97 billion." Retail assets account for 39.9% of the total, and Government Retail assets make up 63.4% of all Retail MMFs. They add, "Assets of institutional money market funds decreased by $59.42 billion to $4.69 trillion. Among institutional funds, government money market fund assets decreased by $63.63 billion to $4.44 trillion, prime money market fund assets increased by $4.46 billion to $241.67 billion, and tax-exempt fund assets decreased by $253 million to $13.14 billion." Institutional assets accounted for 60.1% of all MMF assets, with Government Institutional assets making up 94.6% of all institutional MMF totals. According to Crane Data's separate Money Fund Intelligence Daily series, money fund assets have decreased by $300 million to $8.241 trillion month-to-date in March (as of 3/25), assets hit a record high on March 18 of $8.280 trillion. (Our asset series previous record high, $8.276 trillion, was set on 3/17/26.) Assets increased by $99.5 billion in February, $32.9 billion in January, $126.3 billion in December, $132.8 billion in November, $142.1 billion in October, $105.2 billion in September and $132.0 billion in August. They rose $63.7 billion in July, $6.7 billion in June and $100.9 billion in May. MMFs fell by $24.4 billion in April, but rose $2.8 trillion last March. Note that ICI's asset totals don't include a number of funds tracked by the SEC and Crane Data, so they're almost $400 billion lower than Crane's asset series.
Reuters: Fidelity Lawsuit Dismissed
Reuters published the news brief, "Fidelity beats lawsuit over fees in US$439 billion money market fund." The piece explains, "A U.S. federal judge dismissed a lawsuit on Wednesday accusing mutual fund giant Fidelity of cheating many investors in its US$439.1 billion Fidelity Government Money Market Fund by keeping them in higher-cost share classes than they were eligible for. U.S. District Judge Margaret Garnett in Manhattan rejected claims that Fidelity unjustly enriched itself, and the fund's board and investment managers breached their fiduciary duties, by failing to automatically convert 'retail class' shares into lower-cost 'premium class' shares once balances hit $100,000 in non-retirement accounts or $10,000 in retirement accounts." Reuters comments, "Retail investors said Boston-based Fidelity shortchanged them out of millions of dollars by continuing to charge fees and expenses of up to 0.42 percent on their investments, rather than up to 0.32 percent on the premium class shares. Garnett, however, said Fidelity fully disclosed the economic consequences of converting or not converting shares. She also said investors neither showed that Fidelity's disclosures regarding conversions were misleading nor disputed they could readily convert their shares on their own."
St. Louis Fed Corporate Cash Study
The Federal Reserve Bank of St. Louis wrote earlier this month on "Financing R&D Spending: The Role of Corporate Cash Holdings." The summary says, "Research and development (R&D) investment and productivity growth have long been recognized as central drivers of economic growth. Yet innovation is inherently difficult to finance externally: It is intangible, risky and subject to severe asymmetric information. As a result, firms with higher R&D intensity -- R&D expenditures divided by total assets -- tend to hold a larger share of their assets in cash." It tells us, "In recent years, with the need to invest in artificial intelligence (AI), it has become more important to understand the role of cash. For example, 'hyperscalers' have announced their investment plans on their AI-related projects at unprecedented levels. In this blog post, we will explore how cash holdings and R&D intensity of U.S. firms have changed over time. We will also discuss possible implications of these trends for the future given the increase in AI-related investment." The study explains, "For our analysis, we studied firms that are U.S. incorporated and publicly traded between 1979 and 2024 using S&P Compustat data. We focused on nonfinancial and nonutility firms because financial firms are likely to hold cash for different reasons, such as liquidity requirements, and utility firms are likely to be regulated. Variables were inflation-adjusted to 2017 U.S. dollars and were converted into U.S. dollars if reported in other currencies." It adds, "The first figure displays the distribution of the cash ratio among firms from 1979 to 2024, showing the time series of the 25th, 50th, 75th and 90th percentiles as well as the mean, all weighted by firm assets. The cash ratio is defined as cash and short-term investments divided by total assets. Weighting by firm assets gives greater weight to larger firms, so the statistics reflect where most corporate assets were held rather than treating all firms as equal in size. In simple terms, the figure shows how much cash firms held relative to their asset size, and how this differed across the distribution -- from firms holding relatively little cash (25th percentile) to those holding substantially more (90th percentile), as well as the typical firm (the 50th percentile, or median) and the average firm (mean). The figure illustrates a pronounced upward trend in cash holdings, particularly between 1990 and 2010. Over that period, the mean and median increased by 9.1 percentage points and 8.2 percentage points, respectively. More recently, however, the pattern has partially reversed. From 2020 to 2024, the mean and median declined by 3.4 percentage points and 1.3 percentage points, respectively. The decline is even sharper at the top of the distribution, with the 90th percentile falling by 14.9 percentage points."
Money Fund Yields Flat at 3.47%
Money fund yields (7-day, annualized, simple, net) were unchanged at 3.47% on average during the week ended Friday, March 20 (as measured by our Crane 100 Money Fund Index), after decreasing 1 basis point the week prior. Fund yields haven't been below 3.5% since November 2022, and they are down from a recent high of 5.20% in November 2023. They should remain flat in coming days (and weeks) since the Fed left short-term rates unchanged eight weeks ago. Yields were 3.58% on 12/31/25, 3.78% on 11/30, 3.90% on 10/31, 3.94% on 9/30, 4.11% on 8/31, 4.12% on 7/31, 4.13% on 6/30, 4.14% on 3/31/25 and 4.28% on average on 12/31/24. MMFs averaged 4.75% on 9/30/24, 5.10% on 6/28/24, 5.14% on 3/31/24 and 5.20% on 12/31/23. The broader Crane Money Fund Average, which includes all taxable funds tracked by Crane Data (currently 682), shows a 7-day yield of 3.37%, unchanged in the week through Friday. Prime Inst money fund yields were unchanged at 3.59% in the latest week. Government Inst MFs were down 1 bp at 3.46%. Treasury Inst MFs were unchanged at 3.43%. Treasury Retail MFs currently yield 3.20%, Government Retail MFs yield 3.18% and Prime Retail MFs yield 3.37%, Tax-exempt MF 7-day yields were up 27 bps to 2.10%. Money market mutual fund assets have paused since hitting a record high of $8.280 trillion on March 18, according to our Money Fund Intelligence Daily. Assets have risen $40.8 billion in the week through Friday, and they've increased by $21.8 billion in March month-to-date (through 3/20). MMF assets increased by $99.5 billion in February, $32.9 billion in January, $126.3 billion in December, $132.8 billion in November, $142.1 billion in October, $105.2 billion in September and $132.0 billion in August. They rose by $63.7 billion in July, $6.7 billion in June and $100.9 billion in May. But MMFs decreased $24.4 billion in April and increased by $2.8 billion last March. Weighted average maturities were at 43 days for the Crane MFA and 44 days the Crane 100 Money Fund Index. According to Monday's Money Fund Intelligence Daily, with data as of Friday (3/20), just 162 money funds (out of 792 total) yield under 3.0% with $191.9 billion in assets, or 2.3%, while the vast majority (630) of funds yield between 3.00% and 3.99% ($8.071 trillion, or 97.7%). No funds yield over 4.0%. Our Brokerage Sweep Intelligence Index, an average of FDIC-insured cash options from major brokerages, was unchanged at 0.30%, after falling 1 basis point thirteen weeks prior. The latest Brokerage Sweep Intelligence, with data as of March 20, shows no changes over the past week. Four of the 10 major brokerages tracked by our BSI offer rates of 0.01% for balances of $100K (and lower tiers). These include: E*Trade, Merrill Lynch, Morgan Stanley and Schwab.
Reuters: War and Record MMF Assets
Reuters writes, "Investors drive US money market fund assets to records as war-related risk fears multiply." The piece says, "As the Iran conflict intensifies, the spike in oil prices and rising inflation fears are spurring investors to ditch stocks as too risky and shun traditional safe havens such as gold in favor of money market funds. The result: assets in those ultra-short-term and ultra-safe Treasury funds are now hovering around $8 trillion, according to calculations from providers such as the Investment Company Institute, JPMorgan Chase and Crane Data, which specializes in tracking money market flows. While their methodology varies and precise calculations range from $7.8 trillion to $8.1 trillion, the sources agree that assets have hit a record amid the conflict." Reuters quotes Malcolm Polley of Stratos Investment Management, "When you have times of dislocation and times of fear, cash is the only thing that makes sense to a lot of people, because there's the belief that you 'can't lose' by holding it.... [T]he world is not coming to an end just yet." The article adds, "To some, that offers a great case for putting money to one side in a product that currently offers yields north of 3% and, in a handful of cases, approaching 4%, depending on the financial institution. In the first few days of the Iran war, Deborah Cunningham, chief investment officer of global liquidity markets at Federated Hermes, said in an analysis published earlier this month that the 'collective negative vibe often sends investors to safer harbors'.... Cunningham told Reuters she pegs the size of that cash mountain in money markets at $8.3 trillion."
ICI: Assets Jump to Record $7.86 Tril.
The Investment Company Institute published its weekly "Money Market Fund Assets" report Thursday, which shows money fund assets increasing by $38.7 billion to a record high $7.856 trillion, after rising by $0.8 billion the previous week. Assets have risen in 21 of the last 26 weeks and 29 of the past 35 weeks. MMF assets are up by $854 billion, or 12.2%, over the past 52 weeks (through 3/18/26), with Institutional MMFs up $618 billion, or 14.8% and Retail MMFs up $236 billion, or 8.3%. Year-to-date in 2026, MMF assets are up by $123 billion, or 1.6%, with Institutional MMFs up $97 billion, or 2.1% and Retail MMFs up $26 billion, or 0.8%. ICI's weekly release says, "Total money market fund assets increased by $38.68 billion to $7.86 trillion for the week ended Wednesday, March 18, the Investment Company Institute reported.... Among taxable money market funds, government funds increased by $40.55 billion and prime funds decreased by $3.40 billion. Tax-exempt money market funds increased by $1.52 billion." ICI's stats show Institutional MMFs increasing $27.8 billion and Retail MMFs increasing $10.9 billion in the latest week. Total Government MMF assets, including Treasury funds, were $6.469 trillion (82.3% of all money funds), while Total Prime MMFs were $1.244 trillion (15.8%). Tax Exempt MMFs totaled $143.1 billion (1.8%). It explains, "Assets of retail money market funds increased by $10.91 billion to $3.10 trillion. Among retail funds, government money market fund assets increased by $7.82 billion to $1.97 trillion, prime money market fund assets increased by $1.90 billion to $1.01 trillion, and tax-exempt fund assets increased by $1.19 billion to $129.75 billion." Retail assets account for 39.5% of the total, and Government Retail assets make up 63.4% of all Retail MMFs. They add, "Assets of institutional money market funds increased by $27.77 billion to $4.75 trillion. Among institutional funds, government money market fund assets increased by $32.74 billion to $4.50 trillion, prime money market fund assets decreased by $5.29 billion to $237.21 billion, and tax-exempt fund assets increased by $326 million to $13.39 billion." Institutional assets accounted for 60.5% of all MMF assets, with Government Institutional assets making up 94.7% of all institutional MMF totals. According to Crane Data's separate Money Fund Intelligence Daily series, money fund assets have increased by $38.4 billion to $8.280 trillion month-to-date in March (as of 3/18), assets hit a record high on March 18 of $8.280 trillion. (Our asset series previous record high, $8.276 trillion, was set on 3/17/26.) Assets increased by $99.5 billion in February, $32.9 billion in January, $126.3 billion in December, $132.8 billion in November, $142.1 billion in October, $105.2 billion in September and $132.0 billion in August. They rose $63.7 billion in July, $6.7 billion in June and $100.9 billion in May. MMFs fell by $24.4 billion in April, but rose $2.8 trillion in March and $94.2 billion last February. Note that ICI's asset totals don't include a number of funds tracked by the SEC and Crane Data, so they're almost $400 billion lower than Crane's asset series.
Deutsche Centralised Cash Solutions
Securities Finance Times posted an article titled, "Centralised cash solutions: Providing opportunities for optimising cash holdings." The piece says, "Deutsche Bank's Kaitlyn Choo and Cassie von Sprecher provide their insights on how Deutsche Bank is providing solutions to support client's optimal allocation of cash to money market funds and reverse repo, across multiple currencies. As clients continue to face ever changing global interest rate environments, cash as a permanent asset class is here to stay. While both funding and cash placement optimisation solutions continue to converge for many institutional investors, Deutsche Bank has found that providing flexibility for our clients has enabled them to take advantage of these changing rates, in line with their risk and return preferences." The article continues, "The Cash Investment Services (CIS) allows for optimal allocation of cash to either money market funds (MMFs), and/or reverse repo across multiple currencies, through a single access point. This centralised solution provides market access to allow clients to prioritise their cash investment goals, be it safety through collateralisation, yield enhancement, ease of operations, or daily access to liquidity." The post adds, "A diverging rate environment requires clients to have access to capabilities that take advantage of changing rates. Deutsche Bank's Cash Investment Service provides a comprehensive toolkit for managing cash tailored to investor needs, prioritising risk or return based on preferences depending on interest rate volatility."
OMFIF on Tokenised Money Funds
U.K. think tank and lobbying organization OMFIF posted a piece titled, "Which is the fairest of all tokenised monies?" They write, "As markets explore tokenised deposits and stablecoins, tokenised money market fund shares deserve equal attention, given their high credit quality, interest-bearing nature and institutional familiarity. Not only does tokenisation bring considerable benefits to money market fund shares, it changes how institutional liquidity is managed, shifting it from redemption towards circulation. It transforms money market funds from a passive savings vehicle to a multi-purpose financial instrument." The post explains, "Money market funds have grown by more than half during the past five years to about $10tn in assets under management in the US and the European Union. In many jurisdictions, regulatory regimes have been tightened and funds are subject to greater transparency on permissible investments. Several tokenised money market funds have been launched, including Franklin Templeton's Benji and BlackRock's BUIDL." The OMFIF says, "Money market funds are normally used by institutional investors such as pension funds, insurance companies and banks to park excess liquidity.... With tokenisation, fund shares are issued in a token format on blockchain and other distributed ledger technology platforms. The blockchain records and processes ownership of the shares. It allows the merging of fund law with securities tokenisation, converting the technical and legal character of the shares, facilitating their use in settlement and securing intraday liquidity operations without operational recourse to the transfer agent." The article adds, "The interest in tokenised money market fund shares is largely twofold. First, share transfers can occur instantly among subscribers on a delivery-without-payment and delivery-versus-delivery basis to discharge obligations. Atomic settlement enables the exchange of shares of funds denominated in different currencies for foreign exchange transactions – which may help address deficiencies in FX settlement and other cross-border transactions through transfers among domestic and non-resident fund subscribers. Second, the use of the tokenised shares as collateral rests on transferring control of the share to the lender without a title transfer, allowing the borrower to maintain economic exposure to the fund. The absence of a title transfer results in a secured lending operation instead of a conventional repurchase operation."
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