A money market fund turns your cash into a product.

You put in dollars. The fund buys short-term debt and aims to give you back one dollar a share on demand.

That one-dollar promise is the whole point. A rule that finished rolling out in 2024 changed what happens when too many people want out at once.

Money fund assets broke $7.3 trillion in March 2025, a record.

The growth followed higher interest rates, which made cash pay again.

In the background, an SEC rule from 2023 finished taking effect.

Since October 2, 2024, large institutional prime and tax-exempt funds must charge a liquidity fee when daily withdrawals top 5% of assets.

The same reform raised how much cash-like assets these funds must hold: at least 25% that can be sold in a day, and 50% in a week.

It also removed the old power to slam the gates and freeze withdrawals.

The one-dollar share price is not a law of nature. It is held together by rules and math.

Government funds mostly hold Treasury bills and repo. Prime funds also hold short-term company debt called commercial paper.

Each fund keeps a buffer of assets that turn into cash fast. That buffer pays the people who leave.

As long as withdrawals stay small, the buffer covers them and the price holds at a dollar.

When many leave at once, the fund must sell longer holdings. If it sells them below value, the dollar can crack.

That break has a name: breaking the buck. It happened in 2008 to the Reserve Primary Fund.

The first stress point is a run. If big holders pull cash together, the buffer drains fast.

The new liquidity fee is meant to slow that. Above 5% daily outflows, leavers pay the cost of selling, not the people who stay.

The second stress point is what the fund holds. Prime funds carry credit risk that government funds do not.

The third is the link to short-term borrowing markets. Money funds are the biggest buyers of Treasury bills and repo.

When they shift between the two, they move rates across the whole cash market.

Government funds are built to be dull, and dullness is the point. Their Treasury and repo holdings are the safest short assets there are.

That structure deserves confidence in normal times.

What can break is a prime fund under a fast run, if the fee and buffer arrive too late.

You can watch the signal yourself. Each fund posts its daily and weekly liquid assets.

The SEC's Form N-MFP and the fund's own site show how thin the buffer is getting.

The money fund is one of the most trusted machines in finance, and mostly it earns that trust.

The 2024 rule moved the cost of leaving onto those who leave, not those who stay.

The next test is any week that brings a fast, large withdrawal. Watch weekly liquid assets against the 50% minimum the rule now requires.