JP Morgan Chase, the largest bank in the United States and one of the largest financial institutions in the world, has formally entered the contest for on-chain cash, and the prize isn’t just another product line – it’s the billions of dollars sitting in stablecoins and early tokenized funds that currently earn little to no yield.
On December 15 2025, the $4 trillion banking giant launched its My OnChain Net Yield Fund (MONY) on the Ethereum blockchain, aiming to bring large pools of institutional capital into a structure it controls and that regulators recognize.
MONY wraps a traditional money-market fund into a token that can live on public rails, combining the speed of blockchain with a feature that regulated payment stablecoins such as Tether’s USDT and Circle’s USDC cannot legally offer under new U.S. rules: the ability to earn yield.
Rather than being a pure DeFi experiment, MONY represents JP Morgan’s effort to redefine what ‘cash on-chain’ means for large, KYC’d pools of capital and places the bank in direct competition with products like BlackRock’s BUIDL and the broader tokenized Treasuries market, which has grown into the mid-tens of billions as institutions seek yield-bearing, blockchain-native cash equivalents.
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How GENIUS Tilts the Field
The backdrop to this move is the GENIUS Act, a 2025 U.S. law that created a full licensing regime for payment stablecoins and banned issuers from paying interest to holders just for holding the token.
That structure means regulated stablecoins must hold reserves, collect yield, and not pass it through directly. For corporate treasurers and funds holding large stablecoin balances, this creates a structural opportunity cost. MONY, by contrast, is structured as a Rule 506(c) private placement money-market fund – a security sold only to accredited investors and invested in U.S. Treasuries and fully collateralized Treasury repos.
As a money-market fund, it is designed to pass most of the underlying income back to shareholders after fees, rather than trapping all yield at the issuer level.
Crypto research firm, Asva Capital, noted:
“Tokenized money-market funds solve a key problem: idle stablecoins earning zero yield.”
By letting qualified investors subscribe and redeem in either cash or USDC via JP Morgan’s Morgan Money platform, MONY creates a two-step workflow: use tokens like USDC for transactions, then rotate into MONY when yield becomes the priority.
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The Collateral Contest
In derivatives, prime brokerage, and OTC markets, collateral matters around the clock. Stablecoins like USDT and USDC have been default because they are fast and widely accepted, though they are not capital-efficient in high-rate environments. Tokenized money funds are built to fill that gap: holding $100 million in a tokenized MMF that tracks short-term government assets still moves at blockchain speed between venues.
BlackRock’s BUIDL has already shown how tokenized cash can evolve, becoming part of institutional funding stacks when accepted as collateral on major exchange rails. JP Morgan’s MONY targets the same corridor, but tightly tied to its own Kinexys Digital Assets platform and Morgan Money distribution network.
This means the pitch is not to high-frequency traders or offshore entities, but to pensions, insurers, asset managers, and corporates already using traditional MMFs and JP Morgan’s liquidity tools.
Rather than threatening stablecoins with elimination, the real risk is that a meaningful slice of large institutional stablecoin balances migrates into tokenized MMFs – leaving stablecoins concentrated in payments and open DeFi.
The Ethereum Signal
Perhaps the clearest indication of the shift is the choice of Ethereum as the base chain. JP Morgan has operated private ledgers and permissioned networks for years; putting a flagship cash product on a public blockchain acknowledges that liquidity, tooling, and counterparties have converged there.
But even at launch, MONY remains a 506(c) security – tokens live only in allowlisted, KYC’d wallets and transfers are controlled to comply with securities laws. This splits on-chain dollar instruments into two layers: retail and permissionless stablecoins like USDC/USDT on one side, and regulated, yield-bearing, permissioned products like MONY and similar funds on the other.
JP Morgan is betting that the next wave of on-chain volume will come from institutions that want Ethereum’s speed without regulatory ambiguity.
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A Defensive Pivot
Ultimately, MONY looks less like a revolution and more like a defensive pivot. For years, fintech and crypto firms chipped away at banks’ payment, FX, and custody businesses. Stablecoins targeted deposits and cash management by offering digital alternatives outside bank balance sheets. By launching a tokenized MMF on public rails, JP Morgan is trying to pull that migration back inside its own perimeter, even if it cannibalizes some of its traditional deposit base.
George Gatch, CEO of JP Morgan Asset Management, emphasized “active management and innovation” as key to the offering, implicitly contrasting it with passive stablecoin float-skimming models.
Wall Street incumbents like BlackRock, Goldman Sachs, and BNY Mellon have already moved into tokenized MMFs and cash-equivalents – and JP Morgan’s entry shifts the trend from experimentation to open competition over who will own institutional “digital dollars” on public chains.
If this competition succeeds, it won’t spell the end of stablecoins or a DeFi triumph. Instead, settlement rails will stay public and transparent, but the instruments running on them will resemble traditional money-market funds – and the same Wall Street names that dominated finance before tokenization will dominate it after.
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