F/m Investments has taken a groundbreaking step by filing with the SEC to tokenize its U.S. Treasury 3 Month Bill ETF (TBIL), potentially becoming the first firm to operate a tokenized ETF within the existing regulatory framework.
Key Takeaways
- F/m Investments filed an exemptive application with the SEC to tokenize shares of its Treasury ETF (TBIL) using a permissioned blockchain.
- The proposed structure preserves traditional investor protections, including board oversight, transparency, and third-party custody.
- If approved, TBIL would become the first tokenized ETF to operate fully within the Investment Company Act of 1940.
- The move aligns with broader financial industry trends toward regulated blockchain adoption and faster, more efficient settlement systems.
What Happened?
F/m Investments, a firm managing $18 billion in assets, has requested formal permission from the U.S. Securities and Exchange Commission to record ownership of TBIL ETF shares on a permissioned blockchain. This would not only digitize the ETF’s settlement infrastructure but also maintain its compliance with existing securities laws. The filing reflects the industry’s growing push to bring traditional financial products onto blockchain platforms in a regulated and secure manner.
🚨 The “on-chain” era for ETFs has arrived!
— Conor Kenny (@conorfkenny) January 22, 2026
F/m Investments ($18B AUM) has filed a landmark application with the SEC to tokenize shares of its flagship TBIL Treasury ETF.
This is the first time an ETF issuer has sought explicit relief to record ownership of a registered fund… pic.twitter.com/Wff9lnVvKb
F/m’s Application Could Redefine ETF Operations
The SEC application by F/m Investments seeks to tokenize TBIL shares while keeping the same CUSIP code, fees, voting rights, and economic terms. This means that tokenized shares would function identically to conventional ones in terms of rights and obligations.
CEO Alexander Morris explained the firm’s position clearly, stating:
The filing was made under Exchange Act Rule 19b-4, signifying a formal rule-change request, rather than an attempt to bypass regulation. This move underscores F/m’s intent to stay firmly within the SEC’s oversight and maintain all investor protections associated with traditional ETFs.
Why Tokenization?
Tokenization represents the process of converting traditional securities into digital tokens recorded on a blockchain. F/m’s model uses a permissioned blockchain, which ensures only authorized participants can access the ledger, contrasting sharply with the open-access nature of public blockchains.
The key benefits of blockchain-based settlement include:
- Faster Settlement: Reducing T+1 or T+2 transaction timelines to near-instant settlement, minimizing capital lockup and counterparty risk.
- 24/7 Trading Possibility: Permissioned blockchain platforms can allow trading beyond normal exchange hours, supporting global investors.
- Fractional Ownership: Tokenized structures can offer more practical and scalable fractional share models, broadening access to treasury products.
Reinforcing Investor Protections
F/m emphasized that the tokenized TBIL would still comply with all standard ETF practices. These include:
- Independent board oversight.
- Daily portfolio transparency and third-party custody.
- Audit trails and reporting requirements.
- No changes to the fund’s objective or portfolio.
The RBB Fund, which governs F/m’s multi-series trust, played a role in supporting operational consistency under Rule 6c-11, further emphasizing the initiative’s regulatory alignment.
Industry-Wide Movement Toward Blockchain Settlement
F/m’s filing arrives at a time when traditional financial institutions are moving rapidly toward blockchain infrastructure:
- The New York Stock Exchange is developing its own onchain settlement platform for tokenized securities.
- The Depository Trust Company (DTC) received SEC approval for a pilot to settle tokenized securities, including Treasuries and ETFs.
- BlackRock CEO Larry Fink recently highlighted tokenization as a transformational shift, likening it to the early internet.
These developments show a strong push from industry giants to bring Real World Assets (RWAs) into the blockchain era, and F/m’s filing could be the blueprint for regulated participation in this transformation.
CoinLaw’s Takeaway
I see this as a big moment for traditional finance finally embracing the future. What impressed me most is how F/m is not rushing into crypto chaos but building a regulated bridge between two worlds. In my experience watching fintech evolution, the real winners are those who can marry innovation with structure. This isn’t just flashy tech hype. It’s a carefully built legal and operational model that others can follow. If approved, this could change how every ETF thinks about custody, trading, and access.
