Fidelity Enters the Stablecoin Reserve Fund Race

Fidelity launches reserve fund for stablecoin issuers

Fidelity Investments launched the Fidelity Reserves Digital Fund on 18 June 2026. The money market fund serves stablecoin issuers and institutional investors that must hold compliant reserves. Fidelity built the fund around the reserve rules in the GENIUS Act, the federal stablecoin law signed in 2025. The fund gives issuers a regulated vehicle for the liquid assets that back payment stablecoins.

Fund holds short-term Treasuries and Treasury-backed repos

The fund invests in U.S. Treasury bills, notes and bonds that mature in 93 days or less. It also holds cash, overnight repurchase agreements backed by Treasuries, and other compliant government money market funds. The fund charges a net expense ratio of 0.18% and seeks a stable $1.00 share price. Its assets are expected to come mainly from stablecoin issuers that back the tokens they sell to customers. Fidelity said the fund may add share classes that use blockchain technology to record ownership.

"Fidelity has a longstanding history in fixed income and money markets, making us uniquely positioned to offer a money market fund for stablecoin issuers that is compliant with the new GENIUS-Act legislation", 18 June 2026. — Robin Foley, Head of Fixed Income, Fidelity

GENIUS Act sets reserve rules for payment stablecoins

The GENIUS Act created the first federal framework for payment stablecoins in the United States. The law requires issuers to hold reserves in cash, short-term Treasury securities and qualifying government money market funds. It also requires issuers to back outstanding stablecoins one-to-one with high-quality liquid assets. That requirement opens a market for asset managers that already run such products. Issuers gain compliance and liquidity management, while managers gain a new pool of institutional cash.

State Street launch precedes Fidelity's entry

Fidelity's entry follows State Street's launch of the State Street Stablecoin Reserves Money Market Fund on 8 June 2026. That fund opened with about $121 million in assets and a 0.18% net expense ratio, with Anchorage Digital among its seed investors. State Street framed its product as part of a broader push into tokenized finance. Fidelity's announcement focused more narrowly on reserve management.

Wall Street firms compete for stablecoin reserves

Several large managers reached the market before Fidelity. BlackRock, Goldman Sachs and BNY each launched GENIUS Act-aligned reserve funds earlier in 2026. Each firm targets the cash and Treasury assets that sit behind regulated dollar tokens. According to State Street, industry forecasts project the stablecoin sector could expand to between $1.9 trillion and $4 trillion by 2030.

USDC anchors a $320 billion stablecoin market

Stablecoins form a market worth roughly $320 billion, used across trading, payments and cross-border transfers. USD Coin (USDC), one of the largest dollar-pegged tokens, traded at $1.00 with a market cap near $74.7 billion at the time of publication (CoinPaprika, 18 June 2026). A larger stablecoin supply would create a bigger pool of reserve assets for managers to handle.

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