Federated Hermes, Inc. Federated Hermes, Inc. has introduced its first money market fund designed to comply with the GENIUS Act, marking a significant step toward aligning traditional liquidity management with emerging digital asset infrastructure. The newly launched Federated Hermes Money Market Management Digital Treasury Fund–Reserve Shares is structured to meet reserve and liquidity requirements expected for stablecoin issuers under the regulatory framework.
The GENIUS Act, passed in 2025, establishes rules for payment-stablecoins requiring full backing with high-quality liquid assets on a one-to-one basis. The fund is designed to comply by investing primarily in US dollar cash equivalents, short-term US Treasury securities, and overnight repurchase agreements that are fully collateralized by US Treasury assets.
The fund aims to generate current income while preserving principal stability, focusing on securities with maturities of 93 days or less and operating under Rule 2a-7 of the Investment Company Act of 1940. This positions it within the regulated money market ecosystem while maintaining a conservative liquidity profile.
Although the fund does not currently use blockchain technology for share recordkeeping, it is designed with the broader digital asset ecosystem in mind. Reserve Shares may be used by payment-stablecoin issuers, institutional investors, and intermediaries, with potential future adoption of blockchain-based infrastructure for ownership tracking.
Federated Hermes emphasized its long-standing leadership in money market innovation and its significant assets under management in liquidity solutions. The launch reflects growing institutional demand for tokenization-ready financial products that can bridge traditional finance and the evolving stablecoin market, signaling a broader shift toward regulated digital asset integration in money market investing.
