Ethereum News Today: Fidelity Challenges BlackRock with Tokenized Treasury Push

Fidelity Investments has introduced a new tokenized money market fund built on the Ethereum blockchain, the Fidelity Digital Interest Token (FDIT). This innovation marks Fidelity's entry into the tokenized Treasury securities market and comes at a time when traditional financial institutions are increasingly exploring blockchain technology to streamline market operations. The fund is a blockchain-based share class of Fidelity's Treasury money market fund, which has attracted over $200 million in assets since its launch [4].

FDIT is structured as a digital representation of one share of the Fidelity Treasury Digital Fund (FYOXX), issued directly on the Ethereum network. The fund’s portfolio is entirely composed of U.S. Treasury securities and cash, and it operates under a 0.20% management fee. Bank of New York Mellon handles the custody of the securities, ensuring compliance with established financial safeguards. As of the latest data, the fund has only two holders, with one holding approximately $1 million worth of tokens and the other holding the remainder [4].

Fidelity’s move positions it as a direct competitor to BlackRock, whose BUIDL fund dominates the tokenized Treasury market with over $2 billion in assets. The broader market for tokenized Treasuries, which also includes products from Franklin Templeton and WisdomTree, has surpassed $7 billion in value. Fidelity’s entry into this space is part of its broader strategy to expand its presence in digital finance and real-world asset (RWA) tokenization, a trend that has gained traction in recent years due to its potential to improve efficiency and reduce settlement times [4].

The launch of FDIT follows Fidelity’s earlier filing with the Securities and Exchange Commission (SEC), where it sought approval to introduce a blockchain-based share class to its digital Treasury fund. This development aligns with Fidelity’s long-term commitment to leveraging blockchain technology for financial applications. The firm’s broader initiatives in digital finance include its work with cryptocurrency custody, institutional-grade crypto trading, and research into blockchain infrastructure [4].

Analysts suggest that the growing adoption of tokenized securities reflects a shift in how traditional financial institutions are adapting to technological advancements. Fidelity’s foray into this space is expected to fuel further competition and innovation, particularly in the context of real-world asset tokenization. The potential for tokenized securities to disrupt conventional market infrastructure is underscored by projections from financial consulting firms, such as McKinsey, which estimate the market could reach $2 trillion in value by the end of the decade [5].

Fidelity’s latest offering also reflects broader industry trends in asset management, where firms are increasingly experimenting with blockchain-based solutions to enhance liquidity, transparency, and operational efficiency. As traditional financial institutions continue to explore the integration of blockchain into their operations, Fidelity’s FDIT represents a significant step toward mainstreaming tokenized assets as a viable investment option.

Source: [1] Fidelity® Q2 2025 Retirement Analysis (https://newsroom.fidelity.com/pressreleases/fidelity--q2-2025-retirement-analysis--retirement-account-balances-reach-new-record-high--rebounding/s/a28ab088-623d-469a-ab35-ddff450b0a4a) [2] Fidelity Investments - Apps on Google Play (https://play.google.com/store/apps/details?id=com.fidelity.android) [3] Fidelity Brokerage Services LLC (https://newsroom.fidelity.com/pressreleases/fidelity--q2-2025-retirement-analysis--retirement-account-balances-reach-new-record-high--rebounding/s/a28ab088-623d-469a-ab35-ddff450b0a4a) [4] Fidelity launches tokenized money market fund where financial backing is provided by BlackRock (https://medium.com/@compassInvestment/fidelity-launches-tokenized-money-market-fund-where-financial-backing-is-provided-by-blackrock-227ca699bbdf) [5] Fidelity Quietly Launches Tokenized Treasury Fund on Ethereum (https://beincrypto.com/fidelity-tokenized-treasury-fund-on-ethereum/)