WisdomTree has launched round-the-clock trading and instant settlement for shares of its tokenized Treasury money market fund, following regulatory approvals that allow secondary market transactions under a dealer-principal model.
The development applies to the WisdomTree Treasury Money Market Digital Fund, known as WTGXX, and marks the first time registered tokenized mutual fund shares governed by the Investment Company Act of 1940 can trade and settle continuously within the United States regulatory framework.
What Makes This Structure Different?
The launch follows exemptive relief granted by the U.S. Securities and Exchange Commission, enabling secondary market liquidity for registered tokenized fund shares. In parallel, WisdomTree Securities, a broker-dealer subsidiary, received approval from the Financial Industry Regulatory Authority to expand its activities to principal trading of registered fund shares.
Under the structure, transactions settle from broker-dealer inventory rather than directly with the fund. Trading occurs bilaterally, with WisdomTree Securities acting as principal up to its balance sheet capacity, rather than through an exchange venue.
Takeaway
The regulatory relief allows tokenized fund shares to trade continuously without altering the fund’s primary market structure, creating a secondary liquidity layer within existing securities law.
How Does Instant Settlement Change Money Market Fund Access?
Traditional mutual fund transactions generally settle on a T+1 basis. Instant settlement allows investors to move capital into yield-bearing assets in real time, reducing idle cash periods and operational delays.
The mechanism uses blockchain-based tokenization to record ownership and process transfers, with settlement initially facilitated through USDC. Investors can transact at any time of day, including outside standard market hours.
Will Peck, Head of Digital Assets at WisdomTree, said, “Instant settlement has been one of the true promises of blockchains and RWA tokenization. We’re grateful for the constructive engagement with the SEC and FINRA, including the grant of exemptive relief and regulatory approvals necessary to bring this innovation to market. This is a true innovation and improvement in the investor experience, and it demonstrates how blockchain can serve as a new set of rails for capital markets. We’re thrilled to bring this feature forward for our tokenized money market fund.”
Takeaway
Continuous Dividend Accrual and Intraday Transfers
Alongside 24/7 trading, WisdomTree introduced continuous dividend accrual for WTGXX shares. Income allocation is calculated based on how long each verified wallet holds tokens during a given day, using blockchain timestamps to track intraday transfers.
This structure allows investors conducting peer-to-peer transfers to receive proportionate daily interest even when tokens move between wallets before end-of-day processing. The model seeks to preserve the fund’s underlying investment process while adapting distribution mechanics to blockchain settlement.
Takeaway
Continuous accrual aligns yield allocation with token holding periods, supporting intraday mobility without forfeiting earned income.
Institutional Access and Future Expansion
The functionality will be made available to institutional investors through WisdomTree Connect, the firm’s institutional platform. WTGXX has already been used by digital asset institutions seeking yield-bearing exposure without moving funds offchain.
The company indicated that, over time, broker-dealers unaffiliated with WisdomTree may participate in providing liquidity, subject to regulatory conditions. Retail availability may also expand through other channels in the future.
Takeaway
Initial institutional focus reflects treasury management demand within crypto-native markets, where continuous liquidity aligns with 24-hour trading cycles.
Regulatory and Structural Implications
The approvals represent a structural shift for registered funds operating within the Investment Company Act framework. Secondary market trading of tokenized shares under dealer-principal liquidity introduces a hybrid model that blends blockchain settlement with traditional broker-dealer oversight.
While blockchain technology enables continuous operation, fund governance, disclosure, and regulatory supervision remain subject to established securities laws. The structure does not convert the fund into a decentralized product but integrates tokenization within a regulated perimeter.
Risks remain associated with blockchain infrastructure, including cybersecurity vulnerabilities, transaction delays during network congestion, and variability in network fees. Investors in money market funds also face traditional risks, including the possibility of loss of principal and the absence of government insurance.
Takeaway
The model demonstrates regulatory adaptation to tokenization, but blockchain operational risks and money market fund credit considerations continue to apply.
Broader Context for Tokenized Real-World Assets
Tokenized real-world assets have expanded across treasury bills, private credit, and other fixed income products. However, integration within registered mutual fund structures has progressed more gradually due to regulatory constraints.
The introduction of continuous trading and settlement for a registered tokenized money market fund suggests incremental regulatory accommodation of blockchain-based settlement rails. Whether similar structures extend to other asset classes will depend on further approvals and market demand.
The launch places tokenized mutual fund shares closer to the operating model of digital asset markets, which function without traditional trading-hour constraints. At the same time, the dealer-based liquidity model retains centralized oversight and balance sheet limits.
Takeaway
Continuous trading of registered tokenized funds narrows the gap between traditional securities and blockchain-based markets while maintaining centralized regulatory controls.
WisdomTree’s move introduces a regulated pathway for round-the-clock trading and settlement of tokenized mutual fund shares. The framework may influence how asset managers approach tokenization within established securities law, particularly for cash management and fixed income strategies.