The rise of tokenised money market funds

Matteo Aquilina, Ulf Lewrick, Federico Ravenna and Lorenzo Schönleber

No 115, BIS Bulletins from Bank for International Settlements

Abstract: Tokenised money market funds (TMMFs) are a fast-growing collateral asset and savings instrument in the crypto ecosystem. Like stablecoins, TMMFs circulate on public permissionless blockchains but offer returns at money market rates and regulatory protections as securities. TMMFs currently cater strongly to decentralised finance protocols and rely on "allow-listing" of blockchain wallets to constrain peer-to-peer trading of their tokens to ensure regulatory compliance. However, such allow lists only constrain direct holding of TMMFs. TMMFs give rise to risks that mirror, and potentially amplify, those found in conventional money market funds, such as liquidity mismatches, as well as the operational and anti-money laundering / countering the financing of terrorism-related risks associated with stablecoins.

Pages: 8 pages
Date: 2025-11-26
New Economics Papers: this item is included in nep-mon and nep-pay
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