State Street launches a fund for stablecoin issuers in accordance with the GENIUS Act
State Street's investment division has announced the launch of a new money market fund called the State Street Stablecoin Reserves Money Market Fund. This instrument is specifically designed for stablecoin issuers, reflecting the growing need for reliable reserve mechanisms amid institutional adoption of digital assets.
The fund fully complies with the requirements of the GENIUS Act, which came into effect in July 2025. This regulatory act establishes clear rules for using money markets to back stablecoins, which is critical for enhancing transparency and trust in this asset class. The first investors in the structure were State Street Bank and Trust Company and crypto bank Anchorage Digital, highlighting traditional financial institutions' interest in regulated solutions.
Head of State Street Investment Management Ye-Sin Hung noted that the GENIUS Act has created a clear regulatory framework for stablecoin reserves. According to her, the new product combines the company's decades of experience in cash management with digital asset infrastructure, ensuring a high level of security and liquidity. Anchorage Digital added that the quality of reserve management is a key factor in transforming stablecoins into foundational financial infrastructure.
Analysts predict that by 2030, the volume of stablecoin issuance could reach $1.9–4 trillion, driven by growing institutional adoption. This, in turn, will increase demand for transparent backing mechanisms, such as government money market funds. Recall that in May, State Street, together with Galaxy, launched the SWEEP fund for 24/7 liquidity management using stablecoins, demonstrating the company's strategic focus on this segment.
Expert commentary: The launch of the State Street Stablecoin Reserves Money Market Fund is a logical step amid tightening stablecoin regulation. The GENIUS Act effectively legitimizes the use of money markets as reserves, and such products will become the standard for issuers seeking compliance. However, investors should consider that even regulated funds carry risks related to interest rates and liquidity, especially during periods of market volatility.