Morgan Stanley Launches Stablecoin Reserve Fund, Positioning as Industry Reserve Manager

Gate News message, April 25 — Morgan Stanley Investment Management (MSIM) has unveiled a stablecoin reserve portfolio fund (MSNXX), a government money market fund designed exclusively for stablecoin issuers to securely hold reserves backing their tokenized fiat versions. The fund invests solely in the safest, most liquid instruments: U.S. Treasury bills (short-term loans to the U.S. government) and repurchase agreements (overnight loans backed by government securities), both structured to preserve principal.

The fund maintains a target net asset value of $1, ensuring investments retain equal value upon redemption without price volatility exposure. It offers daily liquidity, allowing investors to redeem funds on any trading day with no waiting periods or penalties.

With stablecoin market capitalization now reaching $316 billion, dominated by dollar-pegged tokens like Tether and USDC, Morgan Stanley's launch coincides with the GENIUS Act's advancement in Congress. If passed, the legislation would legally require stablecoin issuers to back their tokens with high-quality liquid assets such as Treasury securities and cash equivalents, held through regulated instruments. The fund is positioned to manage reserves ahead of potential regulatory mandates.

Morgan Stanley Investment Management has also recently launched the Morgan Stanley Bitcoin Trust (MSBT), a cryptocurrency exchange-traded product tracking Bitcoin with custody and fund management provided by BNY Mellon. Additionally, in collaboration with BNY Mellon, the firm introduced a tokenized DAP share class for an institutional liquidity fund Treasury securities portfolio, enabling blockchain-based mirror records while official book entries remain held by BNY Mellon.