Fidelity Investments is poised to launch its first stablecoin, FT, designed to serve as a digital cash alternative and tap into the growing tokenized government bonds market.
Fidelity Investments Prepares to Unveil Its Own Stablecoin: FT
A New Player in the Stablecoin Market
Fidelity Investments is in advanced stages of developing its own stablecoin, which plans to serve as a form of digital cash. The company’s strategy for this token involves entering the tokenized government bonds market.
Fidelity Investments is a US-based financial services company that offers investment products and services to individuals, businesses, and institutions.
Founded in 1946 by Edward C. Johnson II, the company has grown into one of the largest mutual fund companies in the world.
Fidelity provides a range of investment options, including index funds, ETFs, stocks, bonds, and retirement accounts.
The company is known for its low-cost investment products and user-friendly online platforms.
How Fidelity’s Stablecoin Will Work
The Boston-based financial services giant, Aim, to create a cryptocurrency whose value is pegged to the U.S. dollar. This stablecoin will provide a convenient way for crypto traders to preserve their fiat value without having to cash out of the market. The token would form part of company’s strategy to enter the tokenized government bonds market.
A stablecoin is a type of cryptocurrency that is pegged to a fiat currency, such as the US dollar.
Its value remains relatively stable and is not subject to market volatility like other cryptocurrencies.
Stablecoins are often used for everyday transactions, remittances, and as a hedge against market fluctuations.
They can be issued by central banks, commercial banks, or private companies.
The most popular stablecoin is Tether (USDT), which has a market capitalization of over $70 billion.
Market Competition
The news emerges just days after Fidelity filed paperwork to register a blockchain-based version of its U.S. dollar money market fund. A Fidelity stablecoin could fill the role of cash in this fund, entering an already crowded market dominated by the likes of Tether’s USDT and Circle’s USDC.
Plans from Other Players
The report comes a day after World Liberty Financial (WLFI), a decentralized finance protocol backed by President Donald Trump, confirmed it too has plans to offer a stablecoin. This development highlights the growing interest in stablecoins as an alternative to traditional fiat currencies.
Next Steps for Fidelity
Fidelity did not immediately respond to CoinDesk’s request for further comment on its stablecoin plans. As the company moves forward with its strategy, it will be interesting to see how its stablecoin compares to existing players in the market.
