BNY Mellon and Goldman Unveil Pilot

Goldman Sachs and Bank of New York Mellon (BNY) have partnered on a new initiative to enable institutional investors to subscribe and redeem tokenised money market fund (MMF) shares via blockchain technology.

The initiative connects BNY’s LiquidityDirect platform to Goldman’s private GS DAP blockchain, enabling a mirrored digital record of MMF share ownership while preserving the underlying structure and settlement via traditional systems.

This is the first time in the United States that fund managers have enabled subscriptions to MMFs through BNY’s LiquidityDirect and Digital Asset platforms, with the share ownership mirrored via GS DAP. Goldman Sachs Asset Management, BlackRock, BNY Investments Dreyfus, Federated Hermes, and Fidelity Investments are taking part in the pilot launch.

The tokens created using GS DAP represent mirror records of MMF shares, but the funds themselves remain managed and settled within traditional frameworks by BNY Mellon. BNY continues to maintain the official books and settlements, while the digital version offers a programmable representation of ownership.

Related: Matt Hougan: Tokenisation – Wall Street’s Next Trillion-Dollar Revolution

What Tokenisation Means for Market Infrastructure

According to Laide Majiyagbe, BNY’s global head of liquidity, financing, and collateral, the tokenisation of MMFs is a foundational step in the industry’s shift to digital finance architecture. BNY sees this as a secure and scalable solution that bridges legacy financial systems with blockchain technology.

Our collaboration with Goldman Sachs Digital Assets highlights our role as a trusted bridge between traditional finance and emerging technologies – empowering clients to navigate this transformation with confidence.

Laide Majiyagbe, Global Head of Liquidity, Financing and Collateral at BNY

Goldman Sachs’ Mathew McDermott noted that the GS DAP tokens could eventually be used as collateral, enabling more seamless asset transfers in the future. However, the pilot remains a closed system without public decentralised finance features.

While tokenised finance is still in its early stages, efforts like this signal growing momentum on Wall Street. BNY and Goldman’s approach mirrors earlier moves by BlackRock, whose BUIDL token has become a major player in the US$6.75 billion (AU$10.23 billion) tokenised US Treasuries and cash equivalents market.

The total tokenised fund market has grown steadily, with Moody’s reporting US$5.7 billion (AU$8.63 billion) in assets since 2021, driven by interest from asset managers and institutional investors seeking low-volatility options with blockchain efficiency.

Related: Tokenised RWAs: The Next-Gen ETFs Opening Private Markets to All