BlackRock's Nikhil Sharma pitches tokenized money market funds as direct collateral
In brief
- BlackRock's Nikhil Sharma says tokenized MMF shares could be posted directly as collateral, per Crypto Briefing.
- Direct posting skips redemption and the multi-day wait for cash to settle.
- BSTBL and BRSRV, launched by BlackRock on August 3, 2026, target GENIUS Act reserve eligibility.
- Adoption hinges on exchanges and clearinghouses agreeing to accept tokenized fund shares.
How the collateral model changes
Under the traditional model, an institution holding money market fund shares typically redeems them for cash before posting that cash as collateral, according to Crypto Briefing. That cycle can take days.
Tokenization changes the order of operations. Because the fund shares exist as tokens, the position itself can be transferred on-chain to a counterparty, and the holder keeps earning the fund's yield while it's posted. Crypto Briefing described BlackRock's broader aim as letting tMMF positions move directly on-chain without the usual cash settlement wait.
Sharma's focus is tokenized money market funds (tMMFs) and stablecoins. He took the digital assets director role in December 2025.
BlackRock's tokenized lineup
BlackRock launched two new tokenized funds, BSTBL and BRSRV, on August 3, 2026, the report said. Both are targeting eligibility as reserve assets under the US GENIUS Act (the federal framework for stablecoins), and BRSRV is built specifically for stablecoin reserves and digital-native institutions. That eligibility is a target. It hasn't been achieved yet.
Both products build on BUIDL, the tokenized fund BlackRock introduced in March 2024, which manages around $2.5 billion in assets per Crypto Briefing. The firm has also rolled out tokenized share classes for its European UCITS money market funds (those totaled $311 billion in AUM as of June 30, 2026, according to the report). On the operational side, BlackRock's working with J.P. Morgan's Kinexys platform, which supports 24/7 peer-to-peer transfers.
It isn't alone here. Fidelity and Invesco are pursuing similar tokenization efforts, the report said.
What has to happen first
Crypto Briefing's analysis frames the demand side plainly: trading venues and lenders all need collateral, and tokenized MMF shares offer a yield-bearing, regulated alternative to idle stablecoins.
So who has to say yes?
Collateral only works if the receiving party accepts it, and the report said adoption depends on counterparties (exchanges and clearinghouses among them) agreeing to take tokenized fund shares. Legal treatment and custody arrangements still have to be tested, as does operational resilience during market stress, according to Crypto Briefing.
Frequently asked questions
How would tokenized money market funds work as collateral?
Under the traditional model, institutions typically redeem money market fund shares for cash before posting that cash as collateral, which can take days. With tokenized shares, the position itself can be transferred on-chain to a counterparty while the holder keeps earning the fund's yield, according to Crypto Briefing.
Are BlackRock's BSTBL and BRSRV approved as GENIUS Act reserve assets?
No. Both funds, launched August 3, 2026, are targeting eligibility as reserve assets under the US GENIUS Act, the federal framework for stablecoins. Crypto Briefing said that eligibility is a target, not a done deal.
What needs to happen before tokenized fund collateral is widely used?
Adoption depends on exchanges, clearinghouses and counterparties agreeing to accept tokenized fund shares as collateral. Legal treatment, custody arrangements and operational resilience during market stress still have to be tested, according to Crypto Briefing.
