BIS "Tokenized money market funds raise concerns of amplifying traditional financial risks"
Summary
- The Bank for International Settlements (BIS) warned that the rapid growth of tokenized money market funds could pose new risks to traditional financial markets.
- BIS pointed out that tokenized money market funds could amplify vulnerabilities in existing money market funds and stablecoins, and transfer traditional financial risks such as bank runs and liquidity crunches into the digital asset ecosystem.
- BIS emphasized the need for regulation of the tokenization market, stating that proactive measures are necessary before it expands into a systemic threat.
The Bank for International Settlements (BIS) warned that rapidly growing tokenized money market funds could introduce new risks to traditional financial markets.
On the 26th (local time), according to virtual asset (cryptocurrency)-focused media DL News, BIS analyzed in its latest report that "the size of tokenized money market funds increased by 265% over the past year, reaching about $9 billion." BIS pointed out that this growth rate could further amplify vulnerabilities found in existing money market funds and stablecoins.
The report emphasized that "tokenized money market funds could transmit traditional financial risks such as bank runs and liquidity crunches to the digital asset ecosystem," and "proactive regulation is needed before this expands into a systemic threat."
BIS acknowledged that the tokenization market can increase financial efficiency, but cited as a main concern that the same risks could spread at a faster pace.
JH Kim
reporter1@bloomingbit.ioHi, I'm a Bloomingbit reporter, bringing you the latest cryptocurrency news.
!['Easy money is over' as Trump pick triggers turmoil…Bitcoin tumbles too [Bin Nansa’s Wall Street, No Gaps]](https://media.bloomingbit.io/PROD/news/c5552397-3200-4794-a27b-2fabde64d4e2.webp?w=250)
![[Market] Bitcoin falls below $82,000...$320 million liquidated over the past hour](https://media.bloomingbit.io/PROD/news/93660260-0bc7-402a-bf2a-b4a42b9388aa.webp?w=250)
