State Street Joins Tokenized Money Market Push With SWEEP Fund
Louis Tellier
December 18, 2025
SWEEP launch: Last week, State Street announced plans to launch its first tokenized product, SWEEP, a tokenized “private liquidity fund” designed for institutional onchain investors. The initial deployment is expected on the Solana blockchain in early 2026, with expansions to Ethereum and the Stellar Network planned thereafter.
Why it matters: With roughly $5.7 trillion in AUM, State Street Investment Management is one of the world's largest asset managers. Its move into tokenized liquidity products follows a path already taken by peers such as BlackRock, Fidelity, WisdomTree, Amundi, and more recently JPMorgan, all of which have introduced onchain money market-style funds to serve crypto-native capital.
Reaching new clients: That momentum is grounded in market traction. Tokenized money market funds now hold close to $9 billion in total value, demonstrating their ability to attract stablecoin issuers, protocol treasuries, and onchain investment funds. For traditional asset managers, these products open access to a growing investor base that sits largely outside their conventional distribution channels.
Crypto-native partnership: To reach that audience, State Street is partnering with Galaxy, which will provide and operate the tokenization infrastructure for SWEEP. Ondo Finance will act as the anchor investor, seeding the fund with an initial $200 million allocation and helping establish early onchain liquidity.
Interview: While detailed operational mechanics and points of differentiation versus existing tokenized funds have not yet been disclosed, State Street is framing SWEEP as a long-term strategic entry into onchain liquidity markets.
We spoke with Kim Hochfeld, Global Head of Cash at State Street Investment Management, about the big opportunity in tokenized money market funds beyond attracting crypto-native capital, and what to expect from State Street’s broader tokenization efforts heading into 2026.
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On the endgame for tokenized money market funds:
“The multi-trillion-dollar opportunity for tokenized money market funds lies in traditional collateral management.
My background is running State Street Investment Management’s traditional cash business, and what originally drew me to this space was the potential for regulated, tokenized money funds to transform how collateral is managed. Putting a tokenized wrapper around a money fund would introduce mobility and near-continuous movement, which is critical for effective collateral and balance-sheet management.
We’ve seen very clearly what happens when that mobility doesn’t exist. During the UK LDI crisis in 2022, institutions had cash sitting in money market funds that they urgently needed for collateral. Accessing that cash required redeeming fund units, a process that took 12, 24, sometimes even 36 hours, and in doing so amplified systemic stress.
If those money fund units had been tokenized, institutions could have transferred the units themselves directly from collateral pledger to collateral receiver, without redeeming the underlying assets. That would have materially reduced liquidity pressure and systemic risk.
This is why regulators globally are increasingly interested in tokenized money market funds. They enable more efficient collateral management, faster capital velocity, and allow institutions to operate with less idle cash on their balance sheets. That, in my view, is the true killer use case.”
On what to expect from State Street in 2026:
“We have an ambitious pipeline of tokenized products planned for 2026 and beyond.
Our longer-term thesis is shaped by a multi-decade wealth transfer and a shift in how assets are held and managed. We expect an increasing share of capital to move from traditional brokerage and custody accounts into digital wallets.
Tokenization allows us to maintain the regulatory protections of traditional asset management while adding the mobility and utility needed for that future, enabling products to operate wherever investors choose to transact.”