Bank for international settlements report: Tokenization of money market funds exceeds 9 billion USD

PANews, November 27, reported by Cryptopolitan, states that the latest report from the bank for international settlements (BIS) indicates that the total assets of tokenized money market funds have surged from $770 million at the end of 2023 to nearly $9 billion, becoming a key source of collateral in the crypto ecosystem. The agency warns that while such assets possess the “flexibility of stablecoins,” they also bring substantial operational and liquidity risks. The BIS identifies liquidity mismatch as the main risk of tokenized money market funds. It points out that although investors can redeem tokenized fund shares daily, the underlying assets still follow the traditional T+1 settlement mechanism. During periods of market pressure, concentrated redemption demands will expose this structural risk. Subsequently, the organization noted that the market is still in its early development stages, and solutions are continuously being improved, such as the distributed ledger repurchase (DLR) system launched by the fintech company Broadridge, which enables same-day settlement of tokenized government bond transfers.