BIS dey warn say $9B tokenized money market funds fit cause liquidity mismatch and contagion risk

Bank for International Settlements (BIS) warn say sharp growth for tokenized money market funds — wey climb from about $770 million for end‑2023 to near $9 billion by late 2025 — don create serious liquidity mismatch and operational risk for crypto markets. These funds dey typically tokenize short‑term Treasury holdings and dem dey offer daily on‑chain redemptions, but the underlying assets dey settle off‑chain next business day. That timing gap fit cause stressed redemptions, make volatility high and cause contagion because people dey use am as on‑chain collateral, for margin and leverage; BIS compare the weakness to past stablecoin failures. Big managers (like BlackRock’s BUIDL, Franklin Templeton’s BENJI, WisdomTree, State Street) dominate supply, concentrate liquidity for few big pools and permissioned wallets wey fit block effective run management. BIS point out tech fixes like intraday tokenized repo systems (example Broadridge’s Distributed Ledger Repo) wey fit shorten settlement lag but dem stress say stronger oversight, risk monitoring and safeguards needed. IOSCO and IMF experts also dey call for proactive regulatory frameworks. Key takeaways for traders: watch tokenized money market funds and on‑chain Treasury liquidity (main keyword: tokenized money market funds), concentration of big holders (notably BUIDL), on‑chain/off‑chain settlement frictions, integration with stablecoins and borrowing markets, and any regulatory responses — all fit affect short‑term funding rates, stablecoin liquidity and leveraged positions.