State Street Investment Management, which oversees more than $5 trillion in assets, and Galaxy Digital launched a tokenized cash management fund on the Solana blockchain on May 5, aiming to give institutions a way to earn yield on idle stablecoins. The State Street Galaxy Onchain Liquidity Sweep Fund (SWEEP) allows qualified investors to use PayPal’s PYUSD stablecoin for subscriptions and redemptions, representing a significant move by a major financial institution to adopt blockchain rails for core operations.
"This fund allows us to bring the TradFi landscape onchain in a resilient way, guided by our long-standing focus on innovation, risk management and client outcomes,” Yie-Hsin Hung, president and chief executive of State Street Investment Management, said in a statement.
The fund’s structure involves a consortium of crypto-native and traditional firms. Galaxy Digital provides the tokenization technology and digital infrastructure, while Anchorage Digital serves as the custodian for stablecoin holdings. State Street Bank and Trust Company retains custody of the fund's traditional securities. The fund also utilizes Chainlink’s technology to publish its net asset value on-chain and ensure interoperability, with plans to expand beyond Solana to the Ethereum and Stellar blockchains.
This launch places State Street in direct competition with other financial giants like BlackRock, whose BUIDL fund has attracted billions since its inception. By tokenizing a piece of the estimated $6 trillion global money-market industry, SWEEP serves as a real-world test of whether institutional investors are ready to shift significant cash holdings onto blockchain infrastructure for continuous, 24/7 portfolio management.
Onchain Convergence
Unlike traditional money market funds, which operate within standard market hours, SWEEP provides around-the-clock access for subscriptions and redemptions. This feature is designed to modernize cash management by allowing funds to move instantly on-chain, a core thesis for the convergence of traditional finance and crypto markets.
“For years we’ve argued that traditional finance and crypto would converge on the same rails,” said Mike Novogratz, founder and CEO of Galaxy. “We believe SWEEP is what that looks like in practice, with a fund managed by an experienced cash manager being available for investors onchain, on infrastructure Galaxy built for institutions.”
The launch deepens an existing partnership between State Street and Galaxy, which began in 2024 with a series of exchange-traded funds focused on digital assets. While the fund was first signaled in late 2025 with a potential $200 million seed allocation from Ondo Finance's OUSG fund, the final launch announcement did not include details of initial investors. Access is limited to qualified institutional purchasers, highlighting the current focus on professional-grade, on-chain financial plumbing.
This article is for informational purposes only and does not constitute investment advice.
