State Street launches stablecoin reserve fund
- State Street has launched a money market fund designed for stablecoin reserve assets under the GENIUS Act framework.
- The fund will invest in US government securities and repurchase agreements commonly used to back stablecoins.
- State Street said the product is designed to meet reserve requirements established under the GENIUS Act as stablecoin adoption grows.
State Street has launched a Rule 2a-7 government money market fund designed to hold reserve assets for stablecoin issuers under the GENIUS Act framework.
The launch comes as asset managers compete to attract stablecoin reserve assets following the introduction of federal regulations for payment stablecoins in the United States.
The fund's initial investors include State Street Bank and Anchorage Digital, a federally chartered crypto bank.
The fund will invest in US government securities and repurchase agreements commonly used to back stablecoins, and State Street said the structure was designed to comply with reserve requirements established under the GENIUS Act.
State Street said growing stablecoin adoption is increasing demand for reserve management solutions; following the announcement the State Street share price was unchanged at the time of reporting.
The launch follows the introduction of the State Street Galaxy Onchain Liquidity Sweep Fund, a tokenised liquidity product developed with Galaxy Digital that enables onchain cash management using stablecoins.
The stablecoin market has grown to approximately US$315 billion from about US$260 billion when the GENIUS Act became law, while Citi has estimated global stablecoin issuance could reach between US$1.9 trillion and US$4 trillion by 2030.