News Archives: July, 2025
Crane Data's latest monthly Money Fund Market Share rankings show assets slightly higher among the largest U.S. money fund complexes in June after being mostly higher in May. Assets have increased in 11 of the past 12 months (only April 2025 saw a decline). Money market fund assets rose by $6.9 billion, or 0.1%, last month to a record $7.421 trillion. Total MMF assets have increased by $88.4 billion, or 1.2%, over the past 3 months, and they've increased by $928.0 billion, or 14.3%, over the past 12 months. The largest increases among the 25 largest managers last month were seen by Fidelity, Schwab, BlackRock, Dreyfus and Allspring, which grew assets by $17.2 billion, $8.1B, $5.4B, $5.2B and $4.3B, respectively. Declines in June were seen by American Funds, Goldman Sachs, Invesco, Morgan Stanley and SSIM (formerly SSGA), which decreased by $10.2 billion, $10.1B, $7.8B, $7.1B and $6.6B, respectively. Our domestic U.S. "Family" rankings are available in our MFI XLS product, our global rankings are available in our MFI International product. The combined "Family & Global Rankings" are available to Money Fund Wisdom subscribers. We review the latest market share totals, and look at money fund yields, which were flat to slightly lower in June.
Over the past year through June 30, 2025, Fidelity (up $229.4B, or 17.4%), BlackRock (up $121.8B, or 23.5%), Schwab (up $119.9B, or 22.5%), JPMorgan (up $114.2B, or 17.2%) and Vanguard (up $84.0B, or 13.7%) were the `largest gainers. BlackRock, Fidelity, Vanguard, American Funds and Schwab had the largest asset increases over the past 3 months, rising by $29.8B, $20.8B, $20.5B, $18.1B and $12.0B, respectively. The largest declines over 12 months were seen by: Columbia (down $3.7B) and PGIM (down $515M). The largest declines over 3 months included: Goldman Sachs (down $30.1B), Morgan Stanley (down $19.4B), Invesco (down $7.1B) and Federated Hermes (down $1.3B).
Our latest domestic U.S. Money Fund Family Rankings show that Fidelity Investments remains the largest money fund manager with $1.548 trillion, or 20.9% of all assets. Fidelity was up $17.2B in June, up $20.8 billion over 3 mos., and up $229.4B over 12 months. JPMorgan ranked second with $776.5 billion, or 10.5% market share (down $1.3B, up $1.6B and up $114.2B for the past 1-month, 3-mos. and 12-mos., respectively). Vanguard ranked in third place with $696.3 billion, or 9.4% of assets (up $1.5B, up $20.5B and up $84.0B). Schwab ranked fourth with $653.5 billion, or 8.8% market share (up $8.1B, up $12.0B and up $119.9B), while BlackRock was the fifth largest MMF manager with $639.9 billion, or 8.6% of assets (up $5.4B, up $29.8B and up $121.8B for the past 1-month, 3-mos. and 12-mos.).
Federated Hermes was in sixth place with $482.4 billion, or 6.5% (up $1.7B, down $1.3B and up $29.7B), while Goldman Sachs was in seventh place with $415.9 billion, or 5.6% of assets (down $10.1B, down $30.1B and up $19.2B). Dreyfus ($297.2B, or 4.0%) was in eighth place (up $5.2B, up $8.7B and up $26.8B), followed by Morgan Stanley ($274.6B, or 3.7%; down $7.1B, down $19.4B and up $30.1B). SSIM was in 10th place ($240.9B, or 3.2%; down $6.6B, up 60M and up $29.9B).
The 11th through 20th-largest U.S. money fund managers (in order) include: Allspring ($216.4B, or 2.9%), Northern ($181.3B, or 2.4%), First American ($174.2B, or 2.3%), American Funds ($168.2B, or 2.3%), Invesco ($160.5B, or 2.2%), UBS ($116.5B, or 1.6%), T. Rowe Price ($55.6B, or 0.7%), HSBC ($45.5B, or 0.6%), DWS ($44.5B, or 0.6%) and Western ($35.1B, or 0.5%). Crane Data currently tracks 61 U.S. MMF managers, unchanged from last month.
When European and "offshore" money fund assets -- those domiciled in places like Ireland, Luxembourg and the Cayman Islands -- are included, the top 10 managers are the same as the domestic list, except: BlackRock moves up to the No. 3 spot, Vanguard moves down to No. 4 and Schwab moves down to the No. 5 spot. Goldman Sachs moves up to the No. 6 spot, while Federated Hermes moves down to the No. 7 spot and Morgan Stanley moves up to the No. 8 spot, while Dreyfus moves down to the No. 9 spot. Global Money Fund Manager Rankings include the combined market share assets of our MFI XLS (domestic U.S.) and our MFI International ("offshore") products.
The largest Global money market fund families include: Fidelity ($1.568 trillion), JP Morgan ($1.069 trillion), BlackRock ($966.0B), Vanguard ($696.3B) and Schwab ($653.5B). Goldman Sachs ($570.8B) was in sixth, Federated Hermes ($494.7B) was seventh, followed by Morgan Stanley ($371.4B), Dreyfus/BNY ($323.0B) and SSIM ($294.6B), which round out the top 10. These totals include "offshore" U.S. Dollar money funds, as well as Euro and Pound Sterling (GBP) funds converted into U.S. dollar totals.
The July issue of our Money Fund Intelligence and MFI XLS, with data as of 6/30/25, shows that yields were mixed in June across all the Crane Money Fund Indexes. The Crane Money Fund Average, which includes all taxable funds covered by Crane Data (currently 721), was 4.01% (unchanged) for the 7-Day Yield (annualized, net) Average, the 30-Day Yield was down 1 bp to 4.00%. The MFA's Gross 7-Day Yield was at 4.38% (unchanged), and the Gross 30-Day Yield was down 1 bp at 4.37%. (Gross yields will be revised once we download the SEC's Form N-MFP data for 6/30/25 on Wednesday.)
Our Crane 100 Money Fund Index shows an average 7-Day (Net) Yield of 4.12% (up 1 bp) and an average 30-Day Yield at 4.10% (down 1 bp). The Crane 100 shows a Gross 7-Day Yield of 4.39% (up 1 bp), and a Gross 30-Day Yield of 4.37% (down 1 bp). Our Prime Institutional MF Index (7-day) yielded 4.26% (up 1 bp) as of June 30. The Crane Govt Inst Index was at 4.13% (up 1 bp) and the Treasury Inst Index was at 4.07% (unchanged). Thus, the spread between Prime funds and Treasury funds is 19 basis points, and the spread between Prime funds and Govt funds is 13 basis points. The Crane Prime Retail Index yielded 3.99% (up 1 bp), while the Govt Retail Index was 3.83% (up 1 bp), the Treasury Retail Index was 3.82% (down 1 bp from the month prior). The Crane Tax Exempt MF Index yielded 2.21% (up 7 bps) at the end of June.
Gross 7-Day Yields for these indexes to end June were: Prime Inst 4.49% (up 1 bp), Govt Inst 4.38% (up 1 bp), Treasury Inst 4.34% (down 1 bp), Prime Retail 4.49% (up 1 bp), Govt Retail 4.38% (up 1 bp) and Treasury Retail 4.34% (down 1 bp). The Crane Tax Exempt Index rose to 2.61% (up 7 bps). The Crane 100 MF Index returned on average 0.34% over 1-month, 1.03% over 3-months, 1.99% YTD, 4.57% over the past 1-year, 4.43% over 3-years annualized), 2.67% over 5-years, and 1.82% over 10-years.
The total number of funds, including taxable and tax-exempt, was down 7 in June at 834. There are currently 721 taxable funds, down 7 from the previous month, and 113 tax-exempt money funds (unchanged from last month). (Contact us if you'd like to see our latest MFI XLS, Crane Indexes or Market Share report.)
The July issue of our flagship Money Fund Intelligence newsletter, which was sent to subscribers Tuesday morning, features the articles: "Money Fund Symposium '25 Major Issues: Assets, Repo," which discusses highlights from our recent conference in Boston; "MFS Keynote: SSIM's Yie-Hsin Hung on the Future of Cash," which excerpts from the State Street Inv. Mgmt. CEO's recent speech; and, "ICI Worldwide: MMFs Rise in Q1'25 to Record $11.8 Tril." which reviews the latest figures on money fund markets outside the U.S.' We also sent out our MFI XLS spreadsheet Tuesday a.m., and we've updated our Money Fund Wisdom database with 6/30/25 data. Our July Money Fund Portfolio Holdings are scheduled to ship on Thursday, July 10, and our July Bond Fund Intelligence is scheduled to go out on Tuesday, July 15.
MFI's "Money Fund Symposium '25" article says, "Crane Data recently hosted its big Money Fund Symposium conference in Boston, where 680 money market professionals discussed rates, tokenization, asset inflows and a number of other hot topics in cash. We quote from some sessions below, and excerpt from the keynote speech at right. (Note: Recordings and conference materials are available in our 'Money Fund Symposium 2025 Download Center.')"
It continues, "In the 'Major Money Fund Issues' segment, Fidelity's Kevin Gaffney comments, 'To comment on the previous panel on tokenization, I think it is an extremely interesting area. And, as we've talked about all day long, money funds are supposed to be this kind of quiet industry that, no one really paid attention to until the last decade or so.... But one of the things I think that's come out of that is that there is new technology that, might hit our market first. I think when you look at, tokenization, it could potentially be a new horizon for money market funds. I think the blockchain technology has the possibility of adding efficiencies, lowering transactional costs, potentially adding new features to money market funds. [But] I don't know that it fundamentally changes what we do from a portfolio management standpoint.'"
We write in our "MFS Keynote article, "Money Fund Symposium's keynote session, 'The Future of Cash,' featured State Street Investment Management CEO Yie-Hsin Hung. She says, 'It's fantastic to be here with all of you. `I want to thank Peter first and foremost for everything that he does for the money fund industry. No one tracks cash better than you. And everyone here relies on your insights, your data, your wisdom in one way or another.'"
It states, "Hung continues, 'So I'm really glad to be here with all of you. And yes, even with my competitors, it's rare to have so many asset managers and industry experts all in one place. But when we do come together, there's a very good reason. Events like these give us a chance to take a big picture look where we've been, where we are, where we're headed. And I'd like to give my thoughts on that today, especially with respect to the future of cash. We think about this a lot at State Street.'"
Our "Worldwide" piece says, "ICI's latest, 'Worldwide Regulated Open-Fund Assets and Flows, First Quarter 2025,' shows that money fund assets globally rose by $246.3 billion, or 2.1%, in Q1'25 to a record $11.845 trillion. Increases were led by a sharp jump in money funds in U.S. and Luxembourg, while Ireland and Brazil also rose. Meanwhile, money funds in China and Turkey were lower. MMF assets worldwide increased by $1.404 trillion, or 13.4%, in the 12 months through 3/31/25, and money funds in the U.S. now represent 60.1% of worldwide assets. European money fund asset totals surpassed Asian MMF totals for the first time since Q4'17."
The article continues, "ICI's release says, 'Globally, equity fund assets decreased, on a US dollar-denominated basis, by 1.7% to $35.09 trillion at the end of the first quarter of 2025. At the same time, bond fund assets increased by 3.8% to $14.30 trillion; balanced fund assets increased by 1.9% to $7.43T, and money market fund assets increased by 2.1% to $11.84 trillion.'"
MFI also includes the News brief, "Assets Set New Record in Early July," which says, "Our MFI Daily asset series hit a record $7.406 trillion on July 3 (then dipped 6/4-5), its first new high since April 2. Our MFI XLS monthly series also eked out a record $7.425 trillion in June. ICI's smaller weekly series shows assets hitting a record $7.078 trillion in the latest week (ended 7/3)."
Another News brief, "SSGA Changes to SSIM," says, "A statement says, 'State Street’s global asset management business has been rebranded from 'State Street Global Advisors' to 'State Street Investment Mgmt.'"
A third News brief titled, "Circle Says Firms Will Move from Stablecoins to Tokenized Money Funds," tells us, "The Registration Statement for Stablecoin issuer Circle Internet Group, warns, 'Circle Tokenized Funds are regulated yield-bearing investments for collateral use in capital markets. We believe that certain major trading firms have moved, and will increasingly move away from, using stablecoins as collateral in favor of TMMFs.'"
A sidebar, "AFP's 2025 Liquidity Survey," says, "The recently released '2025 AFP Liquidity Survey' discusses 'Current Allocations of Short-Term Investments.' AFP says, 'Companies maintain their investments in relatively few vehicles. Organizations invest in an average 2.57 vehicles for their cash and short-term investments -- slightly lower than the 2.7 average reported in 2024. Most organizations continue to allocate a large share of their short-term investment balances -- an average of 80% -- in safe and liquid investment vehicles: bank deposits, money market funds (MMFs) and Treasury securities.'"
Our July MFI XLS, with June 30 data, shows total assets rose $10.1 billion to a record high $7.425 trillion, after jumping $90.3 billion in May, decreasing $26.6 billion in April and $4.6 billion in March. Assets increased $90.4 billion in February, $47.9 billion in January and $113.0 billion in December. Assets jumped $196.1 billion in November, $89.9 billion in October, $155.2 billion in September, $105.6 billion in August, and $19.7 billion last July.
Our broad Crane Money Fund Average 7-Day Yield was unchanged at 4.01%, and our Crane 100 Money Fund Index (the 100 largest taxable funds) was up 1 bp to 4.12% in June. On a Gross Yield Basis (7-Day) (before expenses are taken out), the Crane MFA and the Crane 100 averaged 4.38% and 4.39%. Charged Expenses averaged 0.37% and 0.27% for the Crane MFA and the Crane 100. (We'll revise expenses once we upload the SEC's Form N-MFP data for 6/30/25 on Wednesday, 7/9.) The average WAM (weighted average maturity) for the Crane MFA was 38 days (up 1 day) and the Crane 100 WAM was down 1 day from the previous month at 38 days. (See our Crane Index or craneindexes.xlsx history file for more on our averages.)
ICI published its latest weekly "Money Market Fund Assets" report on Thursday. The weekly series shows money fund assets jumping $55.6 billion to a record $7.078 trillion, after rising $7.6 billion the week prior. Money fund assets have increased by `$774.7 billion (or 12.3%) since the Fed last cut rates on 9/18/24 and have increased by $1.101 trillion (or 18.4%) since 4/24/24. MMF assets are up by $924 billion, or 15.0%, over the past 52 weeks (through 7/2/25), with Institutional MMFs up $489 billion, or 13.3% and Retail MMFs up $435 billion, or 17.6%. Year-to-date, MMF assets are up by just $228 billion, or 3.3%, with Institutional MMFs up $55 billion, or 1.3% and Retail MMFs up $173 billion, or 6.3%.
ICI's weekly release says, "Total money market fund assets increased by $55.56 billion to $7.08 trillion for the week ended Wednesday, July 2, the Investment Company Institute reported.... Among taxable money market funds, government funds increased by $49.96 billion and prime funds increased by $6.60 billion. Tax-exempt money market funds decreased by $1.00 billion." ICI's stats show Institutional MMFs increasing $43.8 billion and Retail MMFs increasing $11.8 billion in the latest week. Total Government MMF assets, including Treasury funds, were $5.769 trillion (81.5% of all money funds), while Total Prime MMFs were $1.170 trillion (16.5%). Tax Exempt MMFs totaled $139.0 billion (2.0%).
It explains, "Assets of retail money market funds increased by $11.78 billion to $2.91 trillion. Among retail funds, government money market fund assets increased by $8.58 billion to $1.83 trillion, prime money market fund assets increased by $4.83 billion to $951.02 billion, and tax-exempt fund assets decreased by $1.63 billion to $126.18 billion." Retail assets account for well over a third of total assets, or 41.1%, and Government Retail assets make up 63.0% of all Retail MMFs.
They add, "Assets of institutional money market funds increased by $43.78 billion to $4.17 trillion. Among institutional funds, government money market fund assets increased by $41.38 billion to $3.94 trillion, prime money market fund assets increased by $1.77 billion to $218.93 billion, and tax-exempt fund assets increased by $625 million to $12.80 billion." Institutional assets accounted for 58.9% of all MMF assets, with Government Institutional assets making up 94.4% of all institutional MMF totals.
According to Crane Data's separate Money Fund Intelligence Daily series, money fund assets have increased by $40.6 billion in July (through 7/2/25) to $7.447 trillion; assets hit a record high of $7.463 trillion on July 1 but dipped on 7/2. Assets increased by $6.7 billion in June and jumped by $100.9 billion in May, but fell by $24.4 billion in April. They rose $2.8 trillion in March, $94.2 billion in February and $52.8 billion in January. They jumped $110.9 billion in December, $200.5 trillion in November, $97.5 billion in October, $149.8 billion in September and $109.7 billion in August. Note that ICI's asset totals don't include a number of funds tracked by the SEC and Crane Data, so they're over $330 billion lower than Crane's asset series.
In other news, an SEC filing for the SSGA Funds says, "Effective June 30, 2025, the brand name of the global asset management business of State Street Corporation is changing from 'State Street Global Advisors' to 'State Street Investment Management.' Accordingly, effective immediately, 'SSIM' replaces 'SSGA as a defined term and 'SSIM' is defined as 'State Street Investment Management' in each Prospectus and SAI. The brand name change will not result in any changes to the management of the Funds." (See Crane Data's July 1 News, "SSGA Changes Name to State Street Inv. Mgmt.; Cunningham on Fed, MFS.")
Another filing for the UBS Series Funds tells us, a "Supplement to the prospectuses relating to UBS RMA Government Money Market Fund, UBS Select Government Preferred Fund, UBS Select Treasury Preferred Fund, and UBS Select 100% US Treasury Preferred Fund, UBS Select Government Institutional Fund, UBS Select Treasury Institutional Fund, and UBS Select 100% US Treasury Institutional Fund, UBS Prime Preferred Fund, and UBS Prime Reserves Fund, each dated August 28, 2024, as supplemented."
It continues, "Dear Investor, The purpose of this supplement is to update certain information regarding additional compensation received by financial advisors at UBS Financial Services Inc. for the above-named series, series of UBS Series Funds. Effective immediately, the Prospectuses are hereby revised as follows: The section captioned 'Managing your fund account' and sub-captioned 'Additional compensation to affiliated dealer' of the RMA Government Prospectus is revised by replacing the third paragraph of that section in its entirety with the following."
The filing says, "In addition, financial advisors at UBS Financial Services Inc. ('Financial Advisors') receive monthly production credits on all eligible average daily cash balances in sweep programs, money market funds, and UBS Bank USA Core Savings. These production credits are taken into account in the calculation of the applicable Financial Advisors' grid rate schedule (which is used to determine a Financial Advisor's compensation)."
It says, "Only balances in eligible accounts, such as a UBS Resource Management Account and UBS Business Services Account BSA, within the relationship will be aggregated towards calculating the cash balances. All advisory accounts, retirement accounts, and qualified plans are ineligible. Other financial intermediaries through which a fund may be purchased/held may have other compensation arrangements with their staff, and an investor should consult with such other firm regarding questions about such arrangements, if any."
UBS writes, "The section captioned 'Managing your fund account' and sub-captioned 'Additional information about your account' of the Select Preferred Prospectus, Select Institutional Prospectus, Prime Preferred Prospectus, and Prime Reserves Prospectus are revised by replacing the sixth paragraph of that section in its entirety with the following."
It says, "In addition, financial advisors at UBS Financial Services Inc. ('Financial Advisors') receive monthly production credits on all eligible average daily cash balances in sweep programs, money market funds, and UBS Bank USA Core Savings. These production credits are taken into account in the calculation of the applicable Financial Advisors' grid rate schedule (which is used to determine a Financial Advisor's compensation). Only balances in eligible accounts, such as a UBS Resource Management Account and UBS Business Services Account BSA, within the relationship will be aggregated towards calculating the cash balances. All advisory accounts, retirement accounts, and qualified plans are ineligible. Other financial intermediaries through which a fund may be purchased/held may have other compensation arrangements with their staff, and an investor should consult with such other firm regarding questions about such arrangements, if any."
Finally, they comment, "The section captioned 'Managing your fund account' and sub-captioned 'UBS Financial Services Inc.: automated purchasing accounts' and sub-sub-captioned 'Additional information about your account' of the Select Preferred Prospectus, Select Institutional Prospectus, Prime Preferred Prospectus, and Prime Reserves Prospectus are revised by replacing the fifth paragraph of that section in its entirety with the following."
The filing says, "In addition, financial advisors at UBS Financial Services Inc. receive monthly production credits on all eligible average daily cash balances in sweep programs, money market funds, and UBS Bank USA Core Savings. These production credits are taken into account in the calculation of the applicable Financial Advisors' grid rate schedule (which is used to determine a Financial Advisor's compensation). Only balances in eligible accounts, such as a UBS Resource Management Account and UBS Business Services Account BSA, within the relationship will be aggregated towards calculating the cash balances. All advisory accounts, retirement accounts, and qualified plans are ineligible. Other financial intermediaries through which a fund may be purchased/held may have other compensation arrangements with their staff, and an investor should consult with such other firm regarding questions about such arrangements, if any."
The Bank of France published a report titled, "Tokenised money market funds: what are the implications for financial stability?" A section titled, "Tokenisation of money market funds: a new bridge between traditional and tokenised finance," states, "Asset tokenisation refers to the process of issuing and recording an asset in digital form, using a database distributed within a community of users, known as distributed ledger technology (DLT). Tokenised money market funds are similar to traditional money market funds, but differ in their modus operandi. Their legal nature and return remain identical to those of a traditional money market fund. The novelty lies in the recording of fund units in the form of tokens traded on distributed ledgers rather than with a central securities depository as is the case with traditional money market funds. This allows automated operations -- using computer programmes known as smart contracts -- to reduce costs and speed up transactions."
The brief tells us, "The tokenisation of money market funds holding US Treasuries is growing especially rapidly in the US market, with capitalisation of more than USD 7 billion in June 2025, compared with only USD 100 million at end-2022.... Moreover, the US market has witnessed an increase in the number of tokenised fund managers since 2024, although it remains relatively concentrated, as the market is mainly shared by four major tokenised money market funds. In Europe, the market remains very small at present. Although, the tokenised money market fund market accounts for around 0.1% of the traditional money market fund market, which is worth over USD 7 trillion."
It says, "The characteristics of a tokenised money market fund are comparable to those of a stablecoin in several respects: the short-term assets in which tokenised money market funds are invested are similar to the highly liquid assets that comprise stablecoin reserves, including short-term US Treasuries; just like stablecoins, tokenised money market fund units are easily transferable. However, there are also differences between these two types of assets. Unlike stablecoins, tokenised money market funds provide a return, generally the yield on US Treasuries ... through daily interest payments -- or even by the second for certain funds -- 365 days a year. However, tokenised money market funds may be less liquid than funds for stablecoins, depending on the type of tokenised fund, the liquidity of the assets themselves and the contractual terms and conditions."
Another section, "The tokenisation of money market funds could ultimately pose risks to financial stability," says, "The tokenisation of money market funds could create new contagion channels to financial markets, even though outstanding amounts remain low for the present. "The tokenisation of money market funds creates new interconnections between the crypto asset ecosystem and the traditional financial system via tokenisation redemption mechanisms.... For example, during periods of high volatility in the crypto asset market, crypto asset holders are likely to buy stablecoins in order to stabilise the value of their portfolio. In the future, instead of buying stablecoins, they may prefer to buy into tokenised US money market funds, which have the advantage of providing a return while remaining within the tokenised sphere. When volatility declines, they could convert these fund units into legal tender, which could require the money market fund manager to sell off the underlying US Treasuries, thereby driving down the value of US Treasuries."
The Bank of France paper explains, "The permanent availability of tokenised asset trading platforms introduces a risk of asset prices' gap between the two markets as well as a potential risk of liquidity mismatch if it is possible to redeem tokenised money market funds 24/7. In the event of a spike in redemption requests outside traditional market trading hours, the issuer would be unable to liquidate the underlying assets to meet demand. Because the smart contracts used for tokenised money market funds automatically activate triggers when certain parameters are reached, they could amplify contagion to traditional international markets in a similar way to stablecoins. Nevertheless, the risks appear to be contained for the moment as the tokenised money market fund market remains quite small."
They write, "In addition, tokenised money market funds are subject to technological risks specific to crypto assets, including stablecoins. The dispersion of tokenised fund units across different distributed ledgers with limited interoperability, fragments liquidity and complicates operations.... Moreover, the concentration of service providers can create vulnerabilities in the event of an incident and increase the risk of monopoly. Lastly, DLT can be vulnerable to cyberattacks that target smart contracts, as evidenced by the record amounts stolen in the cryptoasset sector since 2021."
The piece also comments, "Consequently, tokenised money market funds created in the EU -- which have the characteristics of and risks associated with money market funds -- are subject to the same specific rules as traditional money market funds set out in the Money Market Fund Regulation (MMFR). The MMFR harmonises prudential requirements for European money market funds and imposes governance and transparency rules on fund managers to ensure investor protection. Moreover, units in tokenised money market funds, although issued in the form of tokens on DLT, are classified as financial instruments and are therefore not covered by the MiCA Regulation."
Finally, it adds, "At the international level, efforts are continuing to assess whether existing regulatory frameworks adequately deal with the characteristics of different tokenised financial assets (e.g. the prudential framework, operational risk, cyber risk, third-party management). For the Financial Stability Board (FSB), the first task is to address the lack of data and information on the development of tokenisation and to facilitate the sharing of cross-border regulatory and supervisory information on this technology. In this regard, access to open-source data, particularly from DLT platforms, is essential for risk monitoring."
For more on Tokenized MMFs, see these Crane Data News stories: "VanEck Launches Tokenized MMF" (5/19/25), "Moody’s on Tokenization & Money Market ETFs; JPM on Drop in T-Bills" (4/22/25), "Global Treasurer on Tokenized MMFs" (3/13/25), "Standard Chartered Tokenised MMF" (2/24/25), "BlackRock Money Market ETFs Go Live; Ondo Finance on Tokenized MMFs" (2/6/25), and "Northern Q4 Earnings Talk Liquidity, Deposits; Tokenized MMFs, BUIDL" (1/27/25).
Allspring's Global Liquidity Solutions Team recently refreshed the publication, "The Debt Ceiling - Frequently Asked Questions." The piece states, "We preface our discussion of the debt ceiling with the belief that the likelihood of one or multiple technical defaults due to a protracted debt ceiling debate is remote. In the unlikely event of a technical default, we believe it will be short-lived and that, upon resolution, funds are likely to be unaffected. We further believe that, given evidence of preplanning, the Federal Reserve (Fed) would be prepared to act if necessary to calm government markets and ensure their smooth and orderly functioning. While no one knows what a government default situation would look like, we can offer opinions based on our research." (Note: Thanks once more to those who attended our Money Fund Symposium in Boston last week! Attendees and Crane Data Subscribers may access the recordings and MFS Conference Materials here.)
It explains, "Past experience demonstrates that, when push comes to shove, legislators raise the debt ceiling in order to avoid a default. It has not mattered how cordial or fractious the relations have been between the two parties in Congress or between the legislative and executive branches. While some debt ceiling episodes have gone smoothly and others have been used to try to gain a political advantage, eventually a resolution has been reached."
Allspring's "Frequently asked questions include: "Are the debt limit and a government shutdown the same thing?" They reply, "The debt limit and a government shutdown are completely unrelated. A partial government shutdown relates to the budget process and occurs when Congress fails to appropriate funds for operating the government, while the debt limit only constrains the government's total indebtedness. It's entirely possible to have a budget dispute resulting in a government shutdown when the debt ceiling is suspended or far from binding, just as it's possible to have debt ceiling issues in a fully appropriated government with no threat of a shutdown."
Allspring queries, "What impact, if any, does a prolonged debate on raising the limit have on the money markets?" They comment, "Prior to the debt ceiling suspension era, the money markets reacted to the debt ceiling once per episode -- when the debt outstanding approached the limit, cash approached zero, and extraordinary measures approached exhaustion. Leading up to that time, the Treasury typically reduced Treasury bill (T-bill) issuance, resulting in a relative shortage of T-bills, driving their yields lower. At the same time, as the market assessed the likelihood of nonpayment on particular Treasury securities, those instruments generally sold off."
The brief continues, "The specific securities deemed at risk were generally T-bills maturing in the several weeks after the drop-dead date, as well as Treasury notes and bonds -- both those maturing in the same time period and those with interest payments due in that window. For example, if a payment late in October was considered questionable, investors might shun not only Treasury notes maturing then but also those maturing in April or October of future years, which would be due to receive interest payments that might be compromised. The rates on other money market instruments, including government-sponsored enterprise (GSE) discount notes, were generally little changed, as they would be unaffected by a payment delay on Treasury securities."
Allspring asks, "If the debt limit is not raised or suspended and all extraordinary measures have been exhausted by the Treasury, will the U.S. government default?" They answer, "If we get to the point that the Treasury has exhausted all extraordinary measures, explored any further measures, and simply run out of cash to pay the government's bills, then it is likely it would have to default. But what is meant by 'default'? The most likely answer is that it would mean a temporary delay in payments that come due -- in this case, the payment of maturities and interest on Treasury securities. This is widely termed a technical default. The bottom line is that we have no reason to expect the government will default on its obligations in the traditional sense. The worst-case scenario is that it may have to delay a payment or two for a very short period, but the payment likely will be made."
The article also questions, "What would a default look like?" They respond, "Answers to this question fall in the realm of pure speculation because we have very little concrete evidence upon which to base our opinions. Based on past experience, when push comes to shove, legislators act as quickly as possible to raise or suspend the debt ceiling to allow the government to get back to business. `For this reason, we think that, in the unlikely event the government does go into technical default (that is, delaying payment on maturing securities), it would be for a very short period, affecting at most one or two payments. Neither side of the aisle wants to be the one that caused a government default."
The Q&A says, "From a market perspective, we can only speculate. During previous crises, securities that matured shortly after the drop-dead date experienced some stress, with investors by and large shunning their purchase and risk premia causing yields on those bills to gap out. Longer bills, however, were largely unaffected, and trading in those securities continued without discernible disruption. Under a default scenario, depending on whether the securities in question remain on the Fedwire (and we think that will be the case), we could see something similar happen."
It adds, "How would a default affect the repo market? From an operational standpoint, defaulted Treasury securities, the specific issues that had suffered missed or delayed payments, would still be eligible for inclusion as collateral in repo transactions so long as they remained in Fedwire. As a practical matter, lenders might be reluctant to accept such tainted securities as collateral unless higher haircuts, or margins, were offered. In addition, it's possible that lenders also could refuse to accept Treasury securities at risk of default as collateral, even if the Treasury had not yet missed a payment on any security. Because there is no cross-default provision for Treasury securities, the vast majority of Treasury securities could continue to be used to collateralize repo transactions, at least operationally."
Finally, they ask, "If the U.S. government were to default, would money market funds be required to sell any of their defaulted securities holdings?" Allspring answers, "Not necessarily. Under SEC Rule 2a-7, a fund is not automatically required to dispose of a security that is in default. A fund may continue to hold a defaulted security if the fund's board of trustees deems it would be in the best interest of the fund's shareholders.... [A] board may find it is not in the best interests of the fund or its shareholders to sell a delayed security, especially if such a forced sale would lead to a trading loss for the fund and adversely affect the fund's net asset value."
A statement from Yie-Hsin Hung, President & CEO of State Street Investment Management, tells us, "I'm excited to share that State Street's global asset management business has been rebranded from 'State Street Global Advisors' to 'State Street Investment Management' to better reflect the breadth of solutions and services we offer to investors. Along with our new brand, we have refreshed our logo and brand identity to align closer to our parent, State Street, to create a stronger, more unified presence in the marketplace. Today is just the latest step in our evolution as a firm. In the last year, we've entered into new partnerships, expanded solutions through innovation, and entered new markets -- all to better serve you." (Note: Hung gave a keynote speech at our recent Money Fund Symposium titled, "The Future of Cash. Watch for quotes from this in our upcoming Money Fund Intelligence newsletter.)
She explains, "You will see our new branding appear in our communications and website starting today. While our brand may be evolving, our mission to create better outcomes for our clients and the world's investors won't change and how we partner with you every day won't either. Importantly, this rebrand does not involve any changes to the names, control, or ownership of our legal entities and therefore does not require any action on your part. Please feel free to visit our updated website to view our new look."
A press release explains, "State Street Global Advisors, the asset management business of State Street Corporation (STT), today announced its new brand name: State Street Investment Management. The rebranding highlights the firm's focus on growth and engagement with clients and partners, and its commitment to product innovation, in service of creating better outcomes for the world's investors and the people they serve."
It states, "In developing the new brand identity, State Street conducted research and solicited input and feedback from clients, investors and employees around the world. The update puts a stronger focus on the firm's 'One State Street' approach that aims to enhance collaboration across State Street Corporation and expand offerings for the benefit of investors globally."
Chief Marketing Officer John Brockelman comments, "State Street Investment Management is an essential partner to investors, offering them unparalleled expertise, unique insights, and both innovative and cost-effective solutions. We're excited to unveil a new brand that communicates that promise. These changes to our brand strengthen our value proposition, simplify the way we go to market, and improve our clients' experience across State Street."
In other news, Federated Hermes' Deborah Cunningham writes, "Not the time to lack 'conviction'." She tells us, "One of the numerous costs of President Trump's assault on Federal Reserve Chair Powell is casting monetary policy as black and white. It might have seemed that way decades ago. Before Chair Bernanke essentially opened it to the public, the Fed was a black box. It communicated primarily through the Federal Open Market Committee (FOMC) statement and daily trading operations rather than through speeches, press conferences and Congressional testimony. But monetary policy is as gray as it gets in economics, involving as much opinion as data."
She explains, "Trump's tirades also drown out healthy discussions about the central bank. Had he not issued a screed after the FOMC held rates steady last month, the main story might have been a growing restlessness among officials. Actually, it should be. No participant dissented from the decision, but the June Statement of Economic Projections (SEP) shifted subtly from March's, suggesting a potential divide. While the median 'dot' of the fed funds rate remained at 3.9% -- implying two quarter-point cuts this year -- seven voters indicated zero cuts compared to four in March."
Cunningham says, "Powell's response to the shift was to downplay the significance of the dot plot. 'No one holds these rate paths with a great deal of conviction ... and you can make a case for any of the rate paths that you see in the SEP.' One could ask why policymakers bother to produce the SEP if they do not have 'conviction.' Perhaps they actually don't, as there is speculation the Fed might alter the dot plot in its soon-to-be-released updated policy framework. In any case, it seems we won't see a rate cut until September."
She adds, "In the face of withering criticism, it would have behooved Powell to be resolute in his opinion that increased tariffs and intensified geopolitical conflicts could put upward pressure on inflation. After all, his stance has been to avoid the policy mistakes of the 1970s, when the Fed lowered rates too soon and inflation reaccelerated. On this point, he has the backing of most of the FOMC; members raised the Core PCE levels they expect to see in the near future."
Cunningham comments, "One member who seems close to dissenting is Governor Christopher Waller. Citing the weakening labor market, he said he would support a rate cut at July's meeting. But he was appointed by Trump and might be auditioning to succeed Powell. Speaking of that, the Wall Street Journal reported that Trump might take a path we knew was possible: naming the person he will appoint to succeed the Fed chair far earlier than is typical. The newspaper floated Waller, Fed Governor Kevin Warsh, National Economic Council director Kevin Hassett, Treasury Secretary Scott Bessent and former World Bank President David Malpass. That's a lot of names, though. By the time it is sorted out, it already might be time to announce the nominee."
Finally, she tells us, "Whatever the exact placements of the dots, cash managers will be happy for rates to decline only slightly and gradually. At the annual Crane Data Money Fund Symposium, held in late June in Boston, optimism reigned. Many of the attendees and speakers professed confidence that industry money market fund assets will remain above $7 trillion, with some expecting they will approach $8 trillion. If rates do fall by 1 percentage point by the end of 2026, as the SEP also indicated, yields should still top 3%, likely remaining attractive to investors."
Cunningham also says, "Innovation was a focus at the event. Discussions often touched on the digital future, primarily stablecoin and blockchain. The royal court's tech counselor has the ear of King Cash these days, and the sentiment in Boston was that digital liquidity products will grow in stature and number."
