Federated Hermes taps Prometheum for tokenized fund debut in Q1 2027

Federated Hermes, which manages $911.6 billion in assets, has partnered with Prometheum to develop tokenized funds for U.S. brokerage distribution, with the first product expected in Q1 2027.

Prometheum and Federated Hermes said in their Oct. 13 announcement that the planned collaboration will bring blockchain-based investment products to broker-dealers and registered representatives serving American investors.

Under the arrangement, Federated Hermes will supply investment management expertise, while Prometheum’s SEC-registered, FINRA-member broker-dealer subsidiaries will provide the securities infrastructure.

For U.S. customers, the companies described a distribution model built around brokerage accounts and adviser relationships already used for investing. Their stated plan is to extend access beyond platforms primarily serving crypto investors, using financial intermediaries to offer and service the products.

Federated Hermes tokenized funds will use separate distribution and custody services

Within Prometheum’s network, ProFinancial will support distribution of the tokenized products, according to the announcement. Prometheum Capital will custody, clear and settle the products for its customers, while making Federated Hermes’ offerings available to introducing broker-dealers through its correspondent clearing platform.

Through that platform, the firms said, introducing brokers would gain access to the tokenized products using Prometheum Capital’s clearing infrastructure. Federated Hermes will contribute its experience managing investments and its existing work on tokenized solutions in global markets.

Kevin Barr, Federated Hermes’ director of digital assets, tied the partnership to demand from broker-dealers and registered investment advisers for blockchain-based access to traditional investments.

“Tokenized funds are the logical next step for our broker-dealer and RIA clients, who increasingly see demand for on-chain access to traditional investments,” Barr said.

In describing the operational approach, Barr said Federated Hermes intends to distribute the products through regulated, established intermediaries. He added that the effort would use the same operational and investment standards applied across the firm’s fund lineup.

The companies expect the first tokenized fund to reach the market in the first quarter of 2027. Their announcement identifies fund distribution through U.S. securities intermediaries as the central purpose of the collaboration.

Prometheum has already built infrastructure for brokerage distribution

As crypto.news previously reported, Prometheum introduced brokerage distribution infrastructure on May 25, allowing broker-dealers and registered investment advisers to offer tokenized securities and crypto assets through traditional brokerage accounts.

At the time, co-CEO Aaron Kaplan described distribution as an unresolved problem for blockchain-based securities, saying issuers had created tokenized products without establishing a mainstream channel to reach investors at scale.

Prometheum described its network as providing correspondent clearing, custody, execution and recordkeeping for third-party broker-dealers. The May rollout therefore covered several of the services now included in the planned Federated Hermes collaboration.

In the Oct. 13 announcement, Kaplan said tokenized funds had largely been issued through platforms outside the brokerage system used by most Americans. He described the partnership as a “blueprint” for issuing and distributing digital securities through securities firms.

“By pairing an asset manager of Federated Hermes’ caliber with Prometheum’s SEC-registered broker-dealers for offering, custody and clearing services provided to our customers, we are looking to create the path the industry can follow,” Kaplan said.

According to Prometheum’s corporate description, its network also includes Prometheum ATS for secondary-market trading and Prometheum Coinery, an SEC-registered digital transfer agent. Alongside those businesses, the company lists ProFinancial for issuance and distribution and Prometheum Capital for custody, clearing and settlement.

Federated Hermes has participated in earlier tokenized fund work

Federated Hermes’ involvement in tokenized investment infrastructure predates the Prometheum agreement. In July 2025, reporting on the BNY–Goldman money market initiative identified Federated Hermes among the asset managers participating in its initial launch.

Under that arrangement, BNY’s LiquidityDirect platform provided institutional access to money market funds, while Goldman Sachs’ blockchain system used digital tokens to record ownership of fund shares.

Goldman Sachs digital assets head Mathew McDermott said the tokens could support the use of money market fund holdings as collateral and enable easier transfers in the future. His comments described potential functions of that platform rather than terms of the newly announced Prometheum products.

For the current partnership, Federated Hermes said it will draw on both active management experience and a growing range of tokenized solutions in global markets. The firms also identified money market funds as an established area of activity within the tokenized asset market.

As of June 30, Federated Hermes reported $911.6 billion in total assets under management. According to its corporate description, the Pittsburgh-headquartered firm provides equity, fixed-income, private-market, multi-asset and liquidity management strategies to more than 11,000 institutions and intermediaries worldwide.

Recent tokenized fund plans also retain regulated intermediaries

Other recent fund-distribution announcements have specified roles for regulated securities firms. In a Sept. 17 agreement, WisdomTree and MoonPay outlined planned U.S. fund access for eligible investors in WisdomTree’s WTGXX tokenized Treasury money market fund.

WisdomTree said transactions would continue to involve WisdomTree Securities, the broker-dealer distributing WTGXX, while MoonPay would supply blockchain technology and access to its customer network. The company stated that MoonPay would not act as a broker-dealer or investment adviser for the fund.

Prometheum has separately discussed the ownership structure of tokenized U.S. equities under a proposed arrangement with HashKey and Velocity Capital. In comments reported on Sep. 22, Kaplan explained tokenholder ownership rights through the indirect securities holding system established under Article 8 of the Uniform Commercial Code.

Under that proposed equity structure, Kaplan said Cede & Co. would remain the registered owner of shares held at the Depository Trust Company, while customers would hold securities entitlements through intermediaries. The proposed international pilot remained subject to final agreements, regulatory clearance, relevant licences, and completed technical and operational integration.