Fidelity Joins Stablecoin Race – Can It Compete With USDT & RLUSD?

Stablecoins with a $235B market cap are becoming the hottest trend in crypto, and even the Trump family is jumping in with their own digital dollar. Now, Fidelity Investments—one of the biggest names in traditional finance—is making its move. The company is reportedly testing its stablecoin, aiming to scoop a spot in the growing digital asset space. Fidelity’s digital asset team is leading the way, and their new token is designed to work just like cash in the crypto market. This isn’t just a small experiment—it’s part of a bigger plan to dive deeper into the world of tokenized finance. With Trump pushing crypto into the spotlight, the timing couldn’t be better.

Fidelity’s Crypto Expansion Gains Momentum

Fidelity’s latest stablecoin initiative is part of its growing interest in digital assets. The Boston-based firm has also filed to launch a digital U.S. money market fund, expected to go live by the end of May. This fund would compete directly with major players like BlackRock and Franklin Templeton, both of which have been expanding their tokenized finance offerings.

The asset manager is still in the early stages of testing its stablecoin, but reports suggest an official launch could happen soon. If successful, this would place Fidelity alongside other financial giants entering the stablecoin market, including Ripple’s RLUSD and Tether’s USDT, which currently dominates the sector.

Trump’s Influence on Stablecoin Developments

The political landscape has played a significant role in the recent surge of interest in stablecoins. Donald Trump has been vocal about his support for cryptocurrency, with stablecoins emerging as a key focus of his administration.

U.S. Treasury Secretary Scott Bessant recently emphasized the government’s strategy to use stablecoins to maintain the U.S. dollar’s dominance as the world’s reserve currency.

“We are going to keep the U.S. the dominant reserve currency in the world, and we will use stablecoins to do that,” Bessant stated.

Despite this push, critics warn that stablecoins come with risks. Some believe they could disrupt financial stability or become tools for fraudulent activities, raising concerns about regulatory oversight.

Tokenized Finance vs. Stablecoins

Alongside stablecoins, fund managers and crypto companies like Ondo Finance and Hashnote—both backed by stablecoin issuer Circle—are actively exploring tokenized money market funds. These digital assets function as regulated, interest-paying instruments that can also serve as collateral for trading.

While these tokenized funds have already attracted over $5 billion, skeptics argue they lack the deep liquidity and usability of traditional stablecoins. However, Fidelity’s move into this space signals growing institutional interest, marking a new phase in the evolution of digital finance.