Tokenized infrastructure takes shape: JPMorgan and DTCC define the schedule for on-chain securities and cash

Cash that remains in idle places: how MONY redefined what “on-chain money” means

When a corporate treasurer holds uninvested balances, they expect to earn some yield while preserving liquidity. For decades, that search meant traditional money market funds: deposits in short-term instruments backed by the U.S. Treasury, accessible through institutional banking systems. JPMorgan has just offered an alternative that remains fully regulated but lives on Ethereum.

MONY is a private placement fund under Regulation 506©, aimed at accredited investors, where participants receive tokens at blockchain addresses. The fund invests exclusively in U.S. Treasury debt and fully collateralized repurchase agreements backed by U.S. government securities, reinvesting dividends daily and allowing subscription and redemption via stablecoins or traditional cash through Morgan Money platform.

What makes MONY relevant is not technological sophistication but the question it answers: can an on-chain cash equivalent remain within a regulated framework while offering the mobility of a token? The answer JPMorgan built is yes, but under strict operational conditions. The fund launched with an initial capitalization of $100 million, with restricted access to high-minimum individuals and institutions, ensuring participants already operate within established compliance and custody workflows.

DTC: the control layer that kept settlement invisible

To understand why JPMorgan needed to build MONY, it’s essential to understand what DTC (The Depository Trust Company, a subsidiary of the Depository Trust & Clearing Corporation) does. DTC is the infrastructure utility that records and reconciles Wall Street positions after a transaction completes. When you buy a share, the system spends hours reconciling that the buyer’s money and the seller’s asset truly change hands definitively. In most cases, this process happens behind the scenes, transparent to retail investors but critical to market operation.

Most investors never interact directly with DTC. Your broker is a DTC participant; your position exists at a lower level, reflected in your broker’s records, which in turn are reflected in DTC’s books. This layered structure has enabled the U.S. stock market to operate with settlement guarantees and clear ownership, but it also maintains that “dead time” between when you confirm on your broker and when your position is truly irrevocable.

The DTC pilot: moving tokenized rights while tracking every step

The SEC recently issued a no-action letter authorizing DTC to deploy a “Preliminary Base Version” of its tokenization service. This authorization does not mean shares become fully native to blockchain. It means DTC can represent certain positions it holds as tokens, allow those tokens to move between approved blockchain addresses, and keep its official records as the ultimate source of truth.

The key conceptual component is “entitlement.” The token does not attempt to redefine what is legally a U.S. security. It is a digitally controlled representation of a position already held by a DTC participant, designed to move through blockchain-like channels while DTC tracks, at each step, which participant is credited and whether the movement is valid.

Restrictions are not a flaw; they are the feature that makes this operationally feasible. Tokens can only be transferred to “Registered Wallets,” and DTC will provide public and private records where participants can register blockchain addresses as Registered Wallets. The service is not locked into a single chain or set of smart contracts. DTC’s requirements for compatible blockchains and tokenization protocols are “targeted, neutral, and publicly available,” designed to ensure tokens only move to Registered Wallets and that DTC can intervene when necessary.

This intervention is what makes regulated tokenization sound less like crypto slogans and more like real operations. A market utility cannot manage a central service it cannot undo or control. The pilot is built around the idea that tokens can move quickly but within a governance perimeter that can reverse errors, manage incorrect entries, recover lost tokens, and respond to misconduct. DTC even describes mechanisms against “double spending,” including schemes where securities credited to a digital omnibus account are non-transferable until the corresponding token is burned.

The set of eligible assets for the pilot is deliberately narrow: Russell 1000 stocks, major index ETFs, and U.S. Treasury bills, notes, and bonds. Boredom is a feature, not a bug. The pilot begins where liquidity is deep, operational conventions are well understood, and the cost of an error is not existential chaos. DTC targets a practical launch in the second half of 2026, with a no-action authorization valid for three years. That window is long enough to onboard participants and demonstrate resilience but short enough to keep everyone aware they are being evaluated.

How MONY and DTC connect: the accelerated settlement architecture

Connecting these two initiatives reveals the full picture. DTCC is building a way to move tokenized rights through compatible records while DTC tracks each transfer for its official registry. JPMorgan is offering a Treasury-backed instrument that generates yield on Ethereum, which can be maintained as a token, moved between peers (within its transfer restrictions), and reused more broadly as collateral in blockchain environments.

The classic question of tokenization was: “When does this arrive in my broker’s account?” The emerging answer from these initiatives is more specific: the first visible impacts are unlikely to be tokenized blue-chip stocks for retail investors. Instead, they will be components that brokers and treasurers can adopt without rewriting their entire infrastructure: cash sweep products that can move under clearer rules, collateral that can be repositioned within permitted spaces without the usual operational delay, and idle liquidity places that can now generate yield while remaining within regulated frameworks.

The sequence almost writes itself because incentives align with operational restrictions. Institutions will have first access because they can register wallets, integrate custody, and operate with white lists and audits. Retail access will come later, mainly through broker interfaces that hide the chain in the same way they already hide membership in the clearinghouse.

The real gain: not speed, but credibility

The traditional selling point of tokenization was speed: eliminate friction, compress settlement times, remove intermediaries. DTCC and JPMorgan are selling something more specific and credible: a way for securities and cash to meet without breaking the rules that make markets work.

The DTC pilot states that tokenized rights can move, but only among registered participants in compatible records, with reversibility built into the design. MONY states that on-chain cash equivalents can pay yield and reside on Ethereum but remain within the perimeter of a regulated fund sold to accredited investors via a banking platform.

If this architecture consolidates, the gain will not be a sudden migration of everything on-chain. It will be a gradual realization that the dead time between “cash” and “value” was a product feature for decades, not an operational necessity. The second half of 2026 is when we begin to see if tokenized infrastructure can be regulated without losing its advantages.