Morgan Stanley Launches Stablecoin Reserves Portfolio for Issuers

• Morgan Stanley launched the Stablecoin Reserves Portfolio (MSNXX), a money market fund.
• The fund targets issuers and meets the GENIUS Act rules, which requires 100% backing.
• MSNXX invests in cash, US Treasuries, and overnight repo agreements, targeting a $1 NAV.

Morgan Stanley Investment Management (MSIM) has launched the Stablecoin Reserves Portfolio (MSNXX), a new government money market fund built for stablecoin issuers.

The fund is part of the Morgan Stanley Institutional Liquidity Funds trust and is designed to meet reserve investment standards under the Guiding and Establishing National Innovation for US Stablecoins Act, known as the GENIUS Act.

The launch gives payment stablecoin issuers a regulated option to hold reserves backing tokens in circulation.

Built for GENIUS Act Compliance

The GENIUS Act requires stablecoin issuers to maintain 100% reserve backing. Morgan Stanley’s new fund directly targets that need by offering a vehicle for reserve management using short-term government assets.

The Stablecoin Reserves Portfolio seeks capital preservation, daily liquidity, and current income while aiming to maintain a stable $1 net asset value.

The portfolio invests only in cash, US Treasury bills, notes, and bonds with remaining maturities of 93 days or less. It can also hold overnight repurchase agreements backed by US Treasury securities or cash.

The structure is designed to match the reserve quality standards expected under federal stablecoin rules.

Fred McMullen, Co-Head of Global Liquidity at MSIM, said the firm launched the product to meet growing demand from stablecoin issuers. He said the increase in issuers and the rising amount of assets held in stablecoins show a market with room for further growth.

Amy Oldenburg, Head of Digital Asset Strategy at Morgan Stanley, said working with stablecoin issuers is part of a broader effort to modernize financial infrastructure and improve institutional client access to digital products. Oldenburg added,

“Creating opportunities for all client segments as markets evolve will make the next phase of finance possible and more broadly accessible.”

Bank Infrastructure Enters Stablecoin Market

The move adds major bank-backed infrastructure to the stablecoin reserve market. Until now, reserve management has largely been handled through existing custodians, asset managers, or direct Treasury holdings.

Morgan Stanley is now offering a dedicated fund built specifically for issuers operating under new US rules. The new fund follows several recent digital asset launches from Morgan Stanley Investment Management.

In April, the firm launched the Morgan Stanley Bitcoin Trust (MSBT), a crypto exchange-traded product that tracks Bitcoin performance. Earlier this year, it also introduced DAP Class shares of its Treasury Securities Portfolio. 

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