Morgan Stanley Targets BlackRock With Money Market Fund for Stablecoin Issuers

Morgan Stanley debuted a wealth marketplace money intended for stablecoin issuers connected Friday, positioning the merchandise arsenic a mode for companies similar Circle to negociate their reserves.

The Stablecoin Reserves Portfolio (MSNXX), which is disposable connected days erstwhile the New York Stock Exchange is unfastened for business, volition alteration companies to put the reserves that backmost their tokens, the concern slope with $9.3 trillion successful assets said successful an announcement.

Although stablecoin issuers often backmost their tokens with a premix of currency and U.S. Treasuries, Morgan Stanley indicated that MSNXX volition besides allocate to notes and bonds and definite overnight repurchase agreements collateralized by liquid assets.

The merchandise was specifically designed to comply with the GENIUS Act, a national model for stablecoins enacted past twelvemonth that mandates reserve requirements. 

In a statement, Morgan Stanley Co-Head of Global Liquidity Fred McMullen noted the sector’s caller growth, specifically a “significant summation successful stablecoin issuers arsenic good arsenic the increasing fig of assets held successful stablecoins.”

Whether it’s caller usage cases successful accepted concern oregon AI-agent payments, stablecoins are expected to go a $2 trillion marketplace by the extremity of 2028, oregon successful astir 32 months, according to a caller enactment from concern slope Standard Chartered. 

On Friday, the worth of each stablecoins stood astatine $316 billion, according to CoinGecko. The second-largest stablecoin issuer, Circle, presently holds the bulk of its USDC reserves successful the Circle Reserve Fund (USDXX), a BlackRock-managed wealth marketplace fund.

Decentralized concern projects similar Ethena, which offers a synthetic dollar dubbed USDe, person forged a antithetic path: utilizing BlackRock’s tokenized wealth marketplace fund, BUIDL. The merchandise issued connected 9 blockchains was valued astatine $2.5 cardinal connected Friday, according to RWA.xyz.

To beryllium sure, Morgan Stanley’s merchandise won’t commercialized on-chain. However, Amy Oldenburg, the bank’s caput of digital-asset strategy, precocious told Decrypt that tokenized wealth marketplace funds are “definitely a way forward” for the Wall Street giant’s merchandise roadmap.

Earlier this month, Morgan Stanley debuted a spot Bitcoin ETF, which dovetails with the firm’s service of astir 16,000 fiscal advisors. Since the merchandise debuted conscionable implicit 2 weeks ago, it has generated $173 cardinal successful nett inflows, according to Farside Investors.