Trillion-dollar asset manager Invesco looks to plant a flag in tokenized stablecoin reserve sector

Crypto-friendly asset manager Invesco is looking to launch a new money market fund focused on stablecoin reserves, according to a recently amended filing submitted to the Securities and Exchange Commission. 

In particular, Invesco has asked to add the so-called Invesco Stablecoin Reserves Onchain Fund to its Short-Term Investments Trust portfolio, a long-standing Invesco Delaware statutory trust structure that houses other money market-style funds.

The firm last calculated its assets under management at $2.45 trillion in a May 31 report.

This new fund, which doesn’t yet have a ticker, will invest primarily in high-quality, short-term assets such as U.S. Treasuries, repo agreements, and cash equivalents to maintain a stable $1 net asset value. It will also tap blockchain infrastructure firm Superstate as its sub-transfer agent to tokenize its shares to be recorded on "designated" unnamed public blockchains.

This structure, like a litany of similar products from Wall Street institutions looking to break into the stablecoin sector, is designed for stablecoin issuers to hold compliant reserves while earning yield and maintaining daily liquidity.

Last week, for instance, State Street launched a GENIUS-compliant money market fund for stablecoin issuers to park their reserves in a yield-bearing, relatively safe asset, following similar offerings from BlackRock, Morgan Stanley, BNY, JPMorgan and Goldman Sachs.

The Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act, passed last summer, created a federal framework for stablecoins that clarified which assets are eligible to be used for reserves. 

Like State Street’s SSCXX fund, Invesco’s offering will list as a government money market vehicle under Rule 2a-7.

These funds resemble some of the earliest tokenized MMFs, like BlackRock's BUIDL and Franklin Templeton's BENJI, which also maintain $1 NAVs, but are not explicitly designed for stable issuers. 

Superstate historically tokenized shares on Ethereum and Solana. Ethereum’s risks are denoted in the SEC filing, while Solana was not mentioned directly. 

This is not the first time Invesco and Superstate have collaborated. In March, Invesco assumed day-to-day portfolio management of Superstate’s $700 million tokenized U.S. Treasury fund (USTB). The fund was renamed Invesco Short Duration US Government Securities Fund, but still trades under USTB with Superstate continuing to provide tokenization support.

The filing notes that Invesco's fund is expected to become effective approximately 60 days after the June 24 filing.