Federated Hermes to Issue Tokenized Fund Shares in 2027

Federated Hermes, a Pittsburgh‑based asset manager overseeing $911 billion in assets, announced plans to issue its first tokenized fund share classes in early 2027. The move will bring blockchain‑based share classes of its funds into traditional brokerage accounts through a partnership with New York‑based digital securities infrastructure provider Prometheum.

Tokenization Strategy

Federated Hermes has previously worked with third‑party platforms such as Archax, Goldman Sachs and Conduit Digital to create tokenized representations of its existing products. The new initiative marks a shift to issuing tokenized share classes directly, giving the firm greater control over the on‑chain product.

Likely First Product

Kevin Barr, director of digital asset products and platform, indicated that money‑market funds are the most probable first tokenized offering. Money‑market funds, which invest in short‑term debt, align with the firm’s liquidity‑management business and could benefit from faster settlement and programmability.

Partnership with Prometheum

Prometheum will provide regulated brokerage, custody and clearing services. Its SEC‑registered broker‑dealer subsidiaries will handle settlement, while a correspondent clearing platform will allow other broker‑dealers to offer the tokenized products to their clients.

Market Context

Tokenized securities are part of a broader Wall Street push, with firms such as BlackRock, Franklin Templeton, JPMorgan and New York Life Insurance Company also exploring blockchain‑based fund versions. Citi projects the tokenized securities market could reach $5.5 trillion by 2030.

Key facts

• Federated Hermes manages $911 billion in assets.
• First tokenized fund shares to launch early 2027.
• Partnership with Prometheum provides regulated brokerage, custody and clearing.
• Tokenized money‑market funds likely first product.