Federated Hermes partners with Conduit Digital

Federated Hermes has entered a strategic alliance with Singapore based Conduit Digital Holdings to launch a regulated tokenised money market fund distribution structure across the Asia Pacific (APAC) region, including Australia.

Under the arrangement, a Conduit-managed investment fund will invest in the Federated Hermes Short Term US Prime Fund, with shares in the Conduit fund tokenised and offered to institutional and wholesale investors across APAC.

The move marks Federated Hermes' first digital assets initiative in the region and extends its push into tokenisation and next generation investment infrastructure.

The Federated Hermes Short Term US Prime Fund is an actively managed UCITS-authorised money market fund investing primarily in high, quality, US dollar-denominated short-term debt instruments. Federated Hermes has US$676.9 billion in money market assets under management.

The asset manager said the alliance builds on more than 50 years of money market innovation and follows recent tokenisation initiatives, including an alliance with UK-based Archax to provide tokenised access to three UCITS money market funds.

"Tokenised products represent a new and evolving way to engage with our clients, combining our investment expertise with Conduit's MAS-regulated end-to-end tokenisation capabilities and regional distribution network," Federated Hermes head of business development Jim Roland said.

Commenting on the announcement, Federated Hermes director of digital assets product and platform strategy Kevin Barr said the initiative reflects the firm's commitment to expanding its digital asset capabilities.

"We continue to explore on-chain distribution opportunities to enhance flexibility and accessibility, while preserving access to the stability and yield characteristics typically associated with money market funds," Barr said.

"[This] announcement reflects our continued commitment to building a larger digital asset presence, leveraging one of our core strengths in liquidity management."

Roland added APAC's adoption of tokenisation made the region a natural market for the initiative.

"Our customers in the APAC market are leading adoption of tokenisation, making this strategically important region a highly receptive market the natural choice for the launch our latest digital assets initiative," he said.

Conduit Digital Holdings co-founder and chief executive Richard Schroder said the group intended to extend the use of tokenised assets beyond the settlement.

"We are committed to unlocking the full utility of these tokens - moving beyond simple settlement to enable use as collateral, multicurrency management, and integration into AI agentic treasury management systems," Schroder said.

The launch follows Federated Hermes' plans to expand its APAC presence, including a new Hong Kong office, alongside its existing operations in Singapore, Tokyo and Sydney.