BofA: Stablecoins and Tokenization Dey Challenge Money Market Funds
Bank of America rates strategy team dey warn say stablecoins and tokenization of assets dey reshape US Treasury and money market sectors. Stablecoin demand fit push $25–75 billion short-term Treasury bill buys for next year, but BofA talk say e no go too change T-bill dynamics. Instead, stablecoins dey pose bigger competition threat to money market funds cause dem fit give better yield. Some fund managers dey try explore tokenization of MMF shares as defensive move. For July, BNY Mellon and Goldman Sachs don release blockchain-based tokenized money market fund shares—the first time dem do am. With regulatory limits wey dey stop yield on stablecoins, MMFs get small window to adopt tokenization before stablecoins find workaround.
Neutral
Di report dey highlight structural waya—stablecoins dey push small Treasury demand and tokenization of MMF shares—but e no tok say big market wahala go show. Stablecoins enter Treasury bills ($25–75 billion) small small no fit change yields, and tokenized money market funds na just protective innovation. Similar past moves (like pilot tokenized bond issuances) no get big price effect. Short term traders fit expect small small volatiliti for both crypto and Treasury markets. For long run, more tokenization fit support demand for blockchain services but e no go cause big crypto price wahala, so overall market effect go remain balanced.