Before we dive in, let's start with some culture.

In 1760, Giovanni Domenico Tiepolo painted The Procession of the Trojan Horse into Troy. The canvas is chaos and celebration - Trojans hauling the colossal wooden horse through their gates, bodies straining against ropes, faces lit with triumph. The horse looms pale against a muted sky, almost spectral. And in the background, barely visible, Cassandra is being arrested. She alone saw what was coming. No one listened.

What strikes me about the painting isn't the horse. It's the energy. Pure momentum. The Trojans aren't deliberating. They're celebrating. The Greeks had fled. The siege was over. The gift before them was proof of victory.

I thought about that painting on December 15, 2025, when JPMorgan announced the launch of MONY a tokenized money market fund, live on Ethereum. Crypto Twitter erupted. "JPMorgan is on-chain!" The replies read like Tiepolo's faces: garlands, celebration, proof that institutions had finally arrived.

But I spent a decade at Goldman Sachs. I know how my former colleagues think. When they build something, they're not joining a movement. They're entering a market. And the product they've built isn't a gift to crypto. It's a delivery mechanism for something else entirely.

The financial press covered JPMorgan's launch like a coronation. "Largest GSIB to launch tokenized fund on public blockchain." GSIB - Global Systemically Important Bank. The dozen or so institutions regulators consider too big to fail. When one of them moves, the others follow.

The framing suggested surrender Wall Street finally bending the knee to decentralized finance. BlackRock's BUIDL had already crossed $2 billion in assets under management. Franklin Templeton's Benji fund was live. Goldman Sachs and BNY Mellon had announced a partnership to tokenize money market fund shares. The narrative was clear: TradFi is embracing crypto.

Read past the headlines.

MONY is a 506(c) private placement fund SEC-speak for accredited investors only. Minimum investment: $1 million. Individual qualification threshold: $5 million in investable assets. Institutional threshold: $25 million. Every participant goes through full KYC and AML checks before receiving a single token.

This is traditional finance using new plumbing.

BlackRock's BUIDL operates identically. Qualified purchasers only. Institutional custody through BNY Mellon. Tokens can be frozen, wallets blacklisted, redemptions controlled by the issuer. The fund pays yield daily from U.S. Treasury bills and Treasury-backed repos. It's a money market fund that happens to settle on Ethereum.

The distinction matters. Aave and Compound offer yield through permissionless smart contracts. Anyone with a wallet participates. The risk is protocol risk smart contract exploits, oracle failures, liquidity crunches. The reward is access without gatekeepers.

BUIDL and MONY offer on-chain yield with off-chain controls. For institutions that spent the last decade watching DeFi from the sidelines, this is the product they were waiting for. Not a bridge into crypto. A moat around TradFi.

As of January 2026, U.S. money market funds hold around $7.7 trillion. Stablecoins USDT, USDC, and peers hold roughly $300 billion in market cap. On-chain tokenized real-world assets, excluding stablecoins, total approximately $19 billion across all blockchains.

BlackRock's BUIDL holds $2 billion. JPMorgan seeded MONY with $100 million. Small numbers relative to the pools they're designed to capture. But they're not supposed to be large. Not yet.

The strategic logic: a corporate treasury holding $50 million in USDC earns nothing. Zero yield. That same capital in BUIDL earns the prevailing money market rate 4.5% annualized. That's $2.25 million annually in foregone income for choosing the stablecoin. Fiduciaries can't ignore that math forever.

The GENIUS Act, signed in July 2025, created a federal framework for payment stablecoins. It also explicitly prohibited stablecoin issuers from paying yield to holders. Regulatory intent: consumer protection. Practical effect: structural disadvantage. Stablecoins became pure settlement instruments. Tokenized money market funds became the yield-bearing alternative.

Ethereum hosts approximately 65% of all tokenized real-world assets around $12.5 billion as of early January. BlackRock chose Ethereum for BUIDL. JPMorgan chose Ethereum for MONY. Smart contract standards, custody integrations, and liquidity depth made it the obvious settlement layer.

But notice what's happening. Institutions aren't using Ethereum to access Uniswap or Aave. They're using Ethereum as infrastructure the way a shipping company uses ports. The ideology of decentralization is irrelevant to them. The throughput is what matters.

Before tokenization, an institutional investor seeking short-term yield faced friction. Traditional money market funds settled T+1 or T+2. Treasuries required custody accounts and manual processes. Moving between yield and liquidity meant wires, paperwork, time.

Tokenized money market funds collapse that friction. Subscribe through JPMorgan's Morgan Money platform, complete KYC, receive tokens representing fund shares. Those tokens live in a crypto wallet. Yield accrues daily, compounds automatically. Redemptions settle in cash or USDC.

The experience feels like DeFi. The structure is entirely traditional.

MONY holds U.S. Treasury bills and Treasury-backed repos. NAV calculated daily. Each token represents a fund share recorded on Ethereum. Interest payments update token balances automatically. Transfers between whitelisted wallets happen in seconds.

But the control surface remains off-chain. JPMorgan decides who holds MONY tokens. JPMorgan decides who gets whitelisted. Regulators demand a wallet frozen, JPMorgan complies. Sanctions lists expand, tokens get blacklisted. Smart contracts enable functionality. They don't enable permissionlessness.

For institutions, that's precisely the point. A pension fund can hold tokenized treasuries without explaining DeFi risk to its board. A corporate treasury can earn yield without touching an unregulated protocol. An asset manager can offer clients on-chain exposure without the compliance nightmare of self-custody.

The products adopt crypto's infrastructure while explicitly rejecting its philosophy.

Wall Street is executing a hostile takeover of blockchain infrastructure while crypto celebrates their arrival.

This is the pattern every financial revolution follows. New technology creates disintermediation risk. Incumbents ignore it, then fear it, then study it, then absorb it. Railroads were financed by the same banks they threatened to displace. The internet was commercialized by the same media conglomerates it was supposed to destroy. Blockchain will be no different.

The question for allocators isn't whether absorption is happening. It is. The question is what it means for positioning.

Over the next 18 to 36 months:

More GSIBs will launch tokenized products. Goldman Sachs and BNY Mellon have announced collaboration on tokenized money market shares. Citi, Morgan Stanley, and others are building internal capabilities. If JPMorgan offers clients on-chain yield, every other bank matches or loses flows.

Stablecoin issuers will adapt. Tether has announced USAT, a U.S.-compliant stablecoin for the post-GENIUS Act environment. Circle is expanding USDC's utility as settlement infrastructure. But without the ability to pay yield directly, stablecoins become commoditized useful for settlement, less useful for treasury management.

DeFi protocols will integrate tokenized RWAs. MakerDAO already uses real-world assets as collateral for DAI. Frax Finance approved BUIDL as backing for frxUSD. If institutions won't come to DeFi, DeFi will import their products.

If you hold stablecoins in size: start moving. Parking $10 million in USDC while BUIDL pays 4.5% costs you $450,000 annually. That's not a strategic reserve. That's a leak.

If you're evaluating DeFi exposure: recalculate. Protocol risk smart contract bugs, governance attacks, liquidity spirals now competes against regulated alternatives offering comparable yields with institutional safeguards. The question isn't whether DeFi is worth the risk. It's how much incremental yield justifies how much incremental risk. For most allocators, the spread has to widen.

If you're constructing an Ethereum thesis: update it. The bull case is no longer "DeFi adoption drives ETH demand." It's "Ethereum becomes the settlement layer for tokenized TradFi." Different thesis. Arguably more durable. Different valuation drivers.

Tokenized money market funds are permissioned by design. Sanctions compliance, investor accreditation, issuer control. These aren't limitations reluctantly accepted. They're features deliberately built.

For those of us who entered this space seeking alternatives optionality outside the banking cartel, self-sovereignty over financial assets the arrival of BUIDL and MONY is clarifying. The rails are open. The products running on them are not.

This doesn't make tokenized funds bad investments. For institutional allocators operating under fiduciary constraints, they may be excellent investments. Yield, liquidity, and regulatory clarity in one package. The product-market fit is obvious.

But it does mean something for the trajectory of this technology. Every financial innovation begins as a tool for outsiders and ends as infrastructure for incumbents. The printing press started with heretics and ended with newspapers. The internet started with cypherpunks and ended with Facebook. Blockchain started with Bitcoin and will likely end with JPMorgan.

The Trojans celebrated when they wheeled in the horse. They weren't wrong to recognize its craftsmanship. They were wrong to assume it was built for them.

For allocators, the question isn't whether to participate in tokenization. The train has left. The question is whether you're positioned on the side that's absorbing, or the side being absorbed.

And whether you're comfortable with the answer.

Tokenized Money Market Funds:

DeFi Protocols Integrating RWAs:

Stablecoins:

Data:

Tresy is a weekly letter on Real World Assets, tokenization, and the collision between traditional finance and crypto. If this analysis was useful, share it with someone who's navigating the same questions.