NextFin News - JPMorgan Chase & Co. has filed with the U.S. Securities and Exchange Commission to launch its second tokenized money market fund, signaling a significant escalation in the competition for blockchain-based institutional liquidity. The filing, made on May 12, 2026, by the bank’s asset management arm, follows the successful December 2025 debut of its "My OnChain Net Yield Fund" (MONY). This latest move places the largest U.S. bank in a direct race with BlackRock, which recently expanded its own BUIDL fund across multiple public blockchains and filed for a $7 billion tokenized vehicle earlier this month.
The new fund is designed to operate on the Ethereum blockchain via JPMorgan’s Kinexys Digital Assets platform, formerly known as Onyx. According to the filing, the vehicle will invest primarily in short-term U.S. Treasury securities and repurchase agreements, offering institutional investors a way to manage cash with the near-instant settlement capabilities inherent to distributed ledger technology. By moving more of its $3.3 trillion asset management business toward tokenization, JPMorgan is attempting to bridge the gap between traditional repo markets and the burgeoning digital asset ecosystem.
John Donohue, Head of Global Liquidity at J.P. Morgan Asset Management, has been a vocal proponent of this transition. Donohue, who has overseen the firm’s liquidity strategies for years, maintains a pragmatic but bullish stance on blockchain, arguing that tokenization is not a speculative play but a necessary infrastructure upgrade for global GSIB banks. However, his view that tokenized funds will reach $2 trillion in assets by 2030 is currently categorized by many sell-side analysts as an optimistic scenario rather than a market certainty. While JPMorgan’s internal data suggests high demand, the broader institutional adoption remains contingent on regulatory clarity that has yet to fully materialize.
The competitive landscape has shifted rapidly since U.S. President Trump’s administration took office in 2025, bringing a more permissive regulatory tone toward digital finance. BlackRock’s BUIDL fund has already amassed over $500 million in assets, and its recent filing for a "Daily Reinvestment Stablecoin Reserve Vehicle" suggests a move to capture the collateral needs of stablecoin issuers. JPMorgan’s response with a second fund indicates that the bank no longer views tokenization as a pilot project but as a core product line necessary to defend its dominant position in the $6 trillion money market fund industry.
Despite the momentum, some market participants remain skeptical of the immediate benefits. Analysts at rival firms have pointed out that while "atomic settlement" reduces counterparty risk, it also eliminates the "float" that many institutions rely on for intraday liquidity management. Furthermore, the reliance on public blockchains like Ethereum for institutional-grade products continues to face scrutiny regarding gas fee volatility and network congestion. From the current evidence, JPMorgan’s deepening push is a strategic hedge against the disruption of traditional settlement systems, though the path to $2 trillion in on-chain assets remains obstructed by technical and interoperability hurdles.
Explore more exclusive insights at nextfin.ai.
