#risk migration

[rwatimes]

IMF issues tokenisation warning

➤ The IMF warns that monetary policy frameworks must adapt to tokenization, as risk may shift from banks to service providers and market infrastructures. ➤ Tokenization offers benefits like faster settlement and programmable assets but introduces risks such as real-time liquidity demands and faster propagation of failures. ➤ The IMF emphasizes the need for legal certainty, interoperability, and effective oversight of both institutions and code to ensure tokenization strengthens, rather than fragments, the financial system.

[rwatimes]

IMF: Tokenization May Reshape Settlement and Strengthen Stability

The International Monetary Fund has issued one of its most direct endorsements yet of tokenization’s potential to reshape traditional finance, arguing that moving assets, settlement, and recordkeeping onto shared ledgers could dramatically shorten today’s typically multi-day sett...

➤ The IMF endorses tokenization for reshaping finance, potentially shortening settlement cycles through shared ledgers. ➤ However, the IMF warns of risk migration from intermediaries to underlying infrastructure and highlights the need for common standards to prevent market fragmentation. ➤ Regulators are adapting existing laws, and the pace of industry standards and interoperability efforts will determine tokenization's success.