BitGo partners with BNY Mellon to launch BLIQUID money market fund

BNY Mellon, the 240-year-old bank that safeguards more assets than most countries produce in a decade, just took another step into digital assets. The firm has launched BLIQUID, a digitally native money market fund represented by blockchain-based tokens, in partnership with BitGo.

The fund targets eligible institutional clients in the US and UK, with plans to expand further.

What BLIQUID actually is

BLIQUID tokens represent shares in a money market fund created through BNY Investments Dreyfus, the bank’s established fund management arm. Instead of holding traditional fund shares recorded on legacy systems, institutional investors can now hold tokenized versions that live on a blockchain.

BNY Mellon built this on top of its global digital transfer agency capabilities, which provide the infrastructure for issuing and tracking these tokenized shares. The system is designed to handle on-chain settlement while maintaining the compliance and custody standards that institutional investors expect from a bank that services approximately $8.6 trillion in assets and over 7.6 million investor accounts.

BitGo, the digital asset infrastructure firm known for its custody and wallet solutions, is partnering on the initiative. The research notes that the specifics of BitGo’s role in the BLIQUID launch remain vague, with no direct announcements detailing their contribution.

BNY’s digital asset trajectory

This isn’t BNY Mellon’s first foray into crypto infrastructure. The bank launched its digital asset custody platform back in October 2022, initially supporting Bitcoin and ether transfers for select clients. BNY Mellon was the first major US bank to provide regulated custody services for digital assets.

BNY expanded its global digital transfer agency capabilities in October 2023, laying the groundwork for exactly this kind of product launch.

The bigger tokenization picture

BlackRock has been working on its own tokenized share class, known as BSTBL. Baillie Gifford launched a tokenized fund called BAGEY. Franklin Templeton has been running a tokenized money market fund on public blockchains for years now.

What this means for investors

For institutional investors, BLIQUID represents another on-ramp into tokenized products from a trusted counterparty. The fact that it’s a money market fund, not some exotic DeFi yield product, makes the risk profile familiar.

The initial focus on US and UK clients suggests BNY is operating within well-defined regulatory boundaries, but expansion to other markets will depend on how quickly those frameworks develop.

BNY hasn’t publicly detailed the full technical stack behind BLIQUID, and infrastructure choices will matter as interoperability between tokenized assets becomes a competitive differentiator.