Federated Hermes, the asset manager owned by Fidelity, has partnered with Singapore-based Conduit Digital Holdings to distribute a tokenized version of its Short-Term U.S. Prime Fund throughout the Asia Pacific region, according to an announcement made today.
The move places a regulated U.S. money market fund on a tokenized distribution structure in one of the world's fastest-growing crypto adoption zones. Federated Hermes manages approximately $700 billion in assets globally. The partnership channels the fund through Conduit's regulated infrastructure, which the company operates from Singapore.
Tokenized money market funds have emerged as a focal point for institutional crypto adoption over the past 18 months. Funds of this type offer institutional investors daily liquidity, near-zero counterparty risk on the underlying cash holdings, and settlement finality on blockchain networks. The U.S. Securities and Exchange Commission has approved multiple tokenized versions of traditional money market funds for domestic distribution, but Asia Pacific representation has lagged behind North American rollouts.
Conduit Digital Holdings operates as a digital asset service provider licensed in Singapore under the Payment Services Act. The company focuses on institutional-grade infrastructure for tokenized financial products, particularly in Southeast Asia. The partnership does not specify which individual Asia Pacific jurisdictions will have immediate access to the tokenized fund or a timeline for rollout.
Federated Hermes' Short-Term U.S. Prime Fund invests in high-quality short-duration U.S. dollar instruments. The tokenized version is structured as a cash-equivalent instrument for regional institutions seeking dollar exposure without traditional banking intermediaries. The fund's underlying assets remain held in traditional custody arrangements in the United States.
Federated Hermes has been actively expanding its tokenization strategy. The firm launched a tokenized version of its Ultra Short Duration Bond Fund in the U.S. market in 2024 and has since added multiple tokenized fund products to its suite. Asia Pacific expansion takes place as major asset managers compete to capture institutional capital flows through blockchain infrastructure ahead of expected regulatory maturation in the region.
Asset managers entering Asia Pacific tokenized products face regulatory fragmentation: Singapore has established a licensing framework, while jurisdictions like Hong Kong and Australia are still finalizing their approaches. Federated Hermes has structured this partnership to work within existing regulatory boundaries rather than await harmonized regional rules. The announcement disclosed no fund size, minimum investment thresholds, or specific transaction fees.
