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Key Takeaways
- Fidelity launched FYMXX on June 15, a fund for stablecoin issuers under the GENIUS Act.
- FYMXX’s 0.25% fee adds competition as Fidelity targets the $315B stablecoin market.
- Fidelity joins State Street and Blackrock as reserve demand grows toward 2030.
Fidelity Expands Into Stablecoin Infrastructure With New Government Money Fund
Fidelity Investments has launched a government money market fund aimed at stablecoin issuers, adding another major Wall Street name to the race to manage reserves behind digital dollars.
The Fidelity Reserves Digital Fund, which trades under the ticker FYMXX, began operations on June 15. According to the fund’s prospectus, it seeks to generate current income while preserving capital and maintaining liquidity.
The fund is designed for institutional investors, including companies that issue stablecoins. Fidelity said fund shares are expected to be held mainly by one or more stablecoin issuers as part or all of the reserves backing tokens issued to customers.
Fund Built Around GENIUS Act Reserve Rules
FYMXX invests only in reserve assets permitted for stablecoin issuers under the GENIUS Act. Those assets include U.S. Treasury bills, notes, bonds, cash, overnight repurchase agreements and other government money market funds that comply with stablecoin regulations.
The fund aims to maintain a stable net asset value of $1 per share. It carries a 0.25% management fee and requires a minimum initial investment of $1 million, though Fidelity may waive or lower that amount.
The prospectus also notes that fund assets may fluctuate with stablecoin minting and redemptions. That movement could become more pronounced during periods of market stress or volatility, when users may create or redeem stablecoins more quickly.
For stablecoin issuers, the appeal is clear. The fund offers a regulated, liquid, and conservative vehicle for holding reserve assets at a time when U.S. rules are being defined.
Asset Managers Compete for Stablecoin Reserves
Fidelity’s launch comes during a broader rush by investment managers to serve stablecoin companies. Earlier this week, State Street introduced its own GENIUS-aligned money market fund for stablecoin reserves. Other investment managers, such as Blackrock launched similar products last year.
The competition reflects the growing size of the stablecoin market. Total stablecoin capitalization now stands above $315 billion, up sharply since the passage of the GENIUS Act.
As stablecoins grow, their reserve assets are becoming a major institutional business. Issuers need cash-like instruments that can support redemptions, satisfy regulators, and generate income from short-term government debt.
Fidelity is now positioning FYMXX as part of that infrastructure. The launch shows how stablecoins are creating a new bridge between crypto markets and traditional money management, with Treasury bills, repos, and government funds sitting at the center of the digital dollar economy.
