BNY: Asset Manager FOMO Drives Tokenized Fund Adoption
BNY reports that fear of missing out is pushing fund issuers to explore blockchain-based ETFs and tokenized finance products. Growing institutional urgency is accelerating adoption of tokenized fund infrastructure across the industry.
Yuri Konnov
The infrastructure foundation Slavin referenced took shape in July 2025, when BNY and Goldman Sachs jointly launched a mirrored tokenization system for money market fund shares. BlackRock, Fidelity Investments, Federated Hermes, Goldman Sachs Asset Management, and BNY Investments Dreyfus all joined from the outset. Northern Trust Asset Management followed on March 2, 2026, launching a tokenized share class for its NIF Treasury Instruments Portfolio on the same BNY and GS DAP infrastructure. The most recent addition came in June 2026, when Baillie Gifford introduced a native tokenized bond fund called BAGEY, targeting roughly a 7% yield, with BNY providing custody and infrastructure across both Solana and Ethereum.
The pace of product launches has produced measurable market depth. BNY executives confirmed that a double-digit number of tokenized money market funds are now live, and the US SEC oversees more than $1 billion in tokenized money market funds. BlackRock's BUIDL, a tokenized money market fund, reached approximately $2.1 billion in assets under management. In its Q1 2026 report, Pantera Capital counted 168 new tokenization assets launched in 2025, attributing the pace directly to institutional FOMO.
The regulatory scaffolding supporting these products has also advanced. The SEC's January 28, 2026 guidance defined a tokenized security as "a financial instrument enumerated in the definition of 'security' under the federal securities laws that is formatted as or represented by a crypto asset, where the record of ownership is maintained in whole or in part on or through one or more crypto networks". The same SEC statement on tokenized securities drew a distinction between issuer-sponsored tokenization and third-party tokenization of existing securities — a distinction with direct operational consequences for ETF managers.
That third-party risk is one Slavin flagged explicitly. Unaffiliated parties have been creating unauthorized tokenized versions of existing ETFs that trade in unregulated secondary markets, creating reputational exposure for asset managers who had no role in their creation. The concern aligns with the SEC's two-category taxonomy: products tokenized by or on behalf of issuers carry different legal standing than those created by unaffiliated third parties. BNY's own tokenized deposit capability, which BNY's digital assets press release described as operating on a private, permissioned blockchain governed by the firm's established risk and compliance frameworks, is designed to keep institutional clients within that first category.
The competitive dynamic Slavin described is visible in the breadth of firms now active. BlackRock, Franklin Templeton, and others have moved to place traditional financial products on blockchain rails, while Baillie Gifford's BAGEY fund illustrates that the trend has extended beyond US-domiciled managers. The speed of adoption has outpaced secondary-market infrastructure: mechanisms for on-chain trading of tokenized fund shares remain underdeveloped relative to the volume of issuance, and the regulatory treatment of cross-chain transfers has not been fully resolved by existing SEC guidance.
What the June 23 interview does not establish is equally important. Slavin did not disclose the specific ETF issuers engaged in BNY's in-flight tokenization projects, the timelines for any product launches, or the technical standards BNY intends to apply across different blockchain networks. BNY has not published haircut schedules, collateral thresholds, or settlement finality rules for tokenized ETF shares used in institutional workflows. The interview also did not address how BNY plans to handle situations where an unauthorized third-party tokenized version of an ETF exists alongside an issuer-sponsored version on the same network.
The immediate concrete effect of Slavin's disclosure is confirmation that BNY is actively developing multiple ETF tokenization variants for named institutional clients, and that competitive pressure — rather than a completed regulatory framework — is the proximate driver of that pipeline. The announcement does not identify which ETF issuers have signed on, does not specify launch dates or blockchain networks for any particular product, and does not clarify how BNY will differentiate its permissioned infrastructure from the unregulated third-party tokenization activity it has itself flagged as a risk.
