Why WisdomTree’s 24/7 Tokenized Money‑Market Fund Could Redefine Yield Access

Key Takeaways

• You can now trade a regulated money‑market fund 24/7 with instant settlement using USDC.
• WisdomTree’s model leverages a dealer‑principal structure, keeping liquidity on the broker’s balance sheet rather than an exchange.
• The tokenized fund sits in a $730 million niche that grew >600% in a single year, outpacing traditional cash equivalents.
• Regulatory green lights (SEC exemptive relief, FINRA approval) signal a broader shift toward on‑chain yield products.
• Bull case: early‑adopter advantage and superior yield capture; Bear case: liquidity constraints and regulatory uncertainty.

You’ve been missing real‑time access to Treasury yields—until now.

WisdomTree’s 24/7 Tokenized Money‑Market Fund: How It Works

WisdomTree launched the WisdomTree Treasury Money Market Digital Fund (WTGXX) with a groundbreaking feature: secondary trading and settlement are available every hour of every day. The fund remains a traditional money‑market vehicle—investing in short‑term, high‑quality U.S. Treasury securities and targeting a stable $1 net asset value (NAV)—but each share is minted as a blockchain token.

The core innovation is the dealer‑principal model. WisdomTree Securities, the firm’s broker‑dealer affiliate, holds an inventory of tokens and trades directly with counterparties, bypassing the need for a public exchange. When a buyer requests shares, the dealer transfers tokens from its balance sheet and settles the transaction instantly in USDC, the stablecoin pegged to the U.S. dollar. This architecture provides instantaneous settlement, eliminating the typical T+2 delay that applies to conventional mutual‑fund trades.

Redemption and creation of new shares still follow the classic open‑end fund process, ensuring the fund’s regulatory compliance under the Investment Company Act of 1940. The only shift is the speed at which secondary market participants can move in and out of the fund.

Sector Momentum: Tokenized Money‑Market Funds on the Rise

The market for on‑chain cash products is exploding. A recent industry snapshot shows assets under management (AUM) in tokenized money‑market funds climbing from roughly $770 million at the end of 2023 to almost $9 billion today—an increase of more than 1,000% in under two years. This surge is driven by three forces:

• Yield‑seeking investors: With traditional savings rates near zero, the promise of a stable, blockchain‑backed yield is attractive.
• Regulatory clarity: The GENIUS Act of July 2025 barred interest‑bearing stablecoins, pushing capital toward compliant, tokenized funds.
• Technology adoption: Advances in custodial solutions and real‑time settlement infrastructure make on‑chain fund structures operationally viable.

For portfolio managers, the sector now offers a new asset class that can be used for cash‑management, liquidity buffers, or even as a tactical overlay in risk‑adjusted return strategies.

Competitive Landscape: BlackRock, Franklin Templeton, and the Race to On‑Chain Yield

WisdomTree is not alone. The three largest players by AUM are:

• BlackRock’s USD Institutional Digital Liquidity Fund (BUIDL) – ~ $2.17 billion.
• Franklin Templeton’s OnChain U.S. Government Money Fund (FOBXX) – ~ $901 million.
• WisdomTree Treasury Money Market Digital Fund (WTGXX) – ~ $730 million.

Compared to February 2025, BlackRock’s fund grew from $642 million to $2.17 billion, a 238% jump. Franklin Templeton’s AUM more than doubled, and WisdomTree’s balance swelled from $112 million to $730 million—a 552% increase. The rapid scaling illustrates that early‑movers can capture large inflows once the regulatory environment stabilizes.

From an investor‑allocation perspective, BlackRock’s sheer size offers deep liquidity, but the dealer‑principal model introduced by WisdomTree could provide superior execution speed for institutional desks that value immediacy over sheer volume.

Regulatory Backdrop: From GENIUS to CLARITY – What It Means for Investors

The GENIUS Act (July 2025) eliminated interest‑bearing stablecoins from the U.S. market, effectively closing a major loophole for yield‑generating crypto assets. In its wake, tokenized money‑market funds emerged as the only regulated, on‑chain instruments capable of delivering a yield tied to government securities.

Now, Congress is debating the CLARITY Act, which will decide how stablecoin‑derived yield is taxed and whether additional capital‑reserve requirements apply to tokenized funds. The outcome will shape the risk‑return profile of these products for years to come.WisdomTree secured an exemptive relief from the SEC and a FINRA principal‑trading waiver, indicating that regulators are willing to accommodate innovative settlement mechanisms as long as investor protection remains intact. However, the reliance on a broker‑dealer’s balance sheet means that any future tightening of capital rules could directly affect liquidity.

Technical Deep‑Dive: Dealer‑Principal Model and Instant Settlement Explained

In traditional mutual‑fund trading, a buy order is routed to the fund’s custodian, processed at the next NAV calculation (usually once per day), and settled on a T+2 schedule. The dealer‑principal model flips this paradigm:

• Dealer inventory: The broker‑dealer holds a pool of tokenized shares, effectively acting as a market‑maker.
• Principal trade: When a client buys, the dealer sells from its own inventory; when a client sells, the dealer buys back the tokens.
• Instant settlement: Settlement occurs in real time using USDC, which moves on a blockchain in seconds, bypassing the clearing‑house delay.

This setup mirrors how crypto exchanges operate, but it remains within the confines of U.S. securities law because the fund itself is a registered mutual fund, not a security token offering.

Continuous dividend accrual is another novelty: the fund calculates daily income per token and credits it to holders’ verified wallets, even if the tokens change hands intraday. This feature effectively turns the token into a “yield‑bearing” digital cash instrument.

Investor Playbook: Bull vs. Bear Cases

Bull Case

• Early‑adopter advantage: Institutions that integrate 24/7 trading can rebalance cash positions faster than peers, capturing yield differentials in volatile markets.
• Liquidity premium: Instant settlement may justify a modest spread over traditional money‑market funds, but the speed advantage can offset that cost.
• Regulatory tailwind: If the CLARITY Act clarifies stablecoin treatment without imposing heavy burdens, tokenized funds could become the default cash‑management tool for tech‑savvy firms.

Bear Case

• Dealer‑capacity risk: Liquidity is limited to the broker‑dealer’s balance sheet; a sudden surge in redemptions could strain inventory.
• Regulatory uncertainty: Tightening capital requirements for principal dealers or a negative ruling on on‑chain yields could curtail the model.
• Yield competition: As more players enter, spreads may compress, eroding the premium that justifies the tokenized structure.

For most investors, the prudent approach is to allocate a modest slice of the cash‑buffer to WTGXX while monitoring dealer inventory metrics and regulatory developments. Institutional traders can use the 24/7 market to execute tactical moves around macro events that occur outside regular market hours (e.g., overnight Fed announcements).

Bottom Line: Is This the Future of Cash Management?

WisdomTree’s launch is more than a novelty; it is a proof‑of‑concept that a regulated money‑market fund can exist, trade, and settle on a blockchain 24 hours a day, 7 days a week. The combination of instant settlement, continuous yield accrual, and a clear regulatory pathway positions tokenized money‑market funds as a serious contender for the next generation of cash‑management solutions.

Investors who value speed, transparency, and on‑chain accessibility should start evaluating exposure now, while keeping a watchful eye on dealer liquidity and forthcoming regulatory rulings.