MUFG Launches Japan's First Tokenised MMF in Internal Group Trial

MUFG Asset Management has gone live with what it describes as Japan’s first tokenised money market fund (MMF), though the current phase is confined to a demonstration experiment among MUFG group entities rather than a full commercial rollout. The fund is structured as a tokenised investment trust, with Mitsubishi UFJ Trust and Banking serving as trustee, and has been seeded with a 200 million yen (approximately 1.3 million US dollars) investment. MUFG Morgan Stanley is designated as the eventual distributor, and the fund runs on Progmat, the largest tokenisation platform in Japan, in which MUFG holds roughly a 49% stake.

The fund invests in Japanese government bonds with maturities of three months or less and can be subscribed or redeemed on a daily basis, mirroring conventional MMF mechanics. The internal trial is intended to stress-test the operational workflow before the product is opened to institutional investors at a later, unspecified date.

A notable regulatory wrinkle shapes the fund’s addressable market. Japanese stablecoin legislation permits reserves to be held only in short-duration bonds, not in MMFs or repurchase agreements as the United States GENIUS Act allows. Because of this restriction, the tokenised MMF cannot itself serve as a qualifying reserve asset for Japanese stablecoin issuers, which limits one of the more obvious use cases that has driven interest in tokenised cash-equivalent products elsewhere.