{
  "id": 12910644,
  "title": "IMF warns tokenized markets could amplify financial risks",
  "url": "https://urgent.news/2026/10/08/imf-warns-tokenized-markets-could-amplify-financial-risks",
  "topic": "finance",
  "section": "Finance & Markets",
  "published": "2026-10-08T16:25:06.000Z",
  "source": {
    "name": "Cointelegraph",
    "slug": "cointelegraph",
    "url": "https://cointelegraph.com/news/imf-flags-volatility-liquidity-risks-tokenized-markets-grow"
  },
  "original_language": "en",
  "account": "The International Monetary Fund (IMF) has cautioned that tokenized financial markets could potentially exacerbate existing financial risks. In a recent analysis, the IMF highlighted that while tokenized markets are expanding rapidly, they are still a small fraction of traditional markets, with poor interoperability and a lack of universally accepted settlement assets posing significant barriers to their widespread adoption. Trading activity in tokenized markets is dominated by repos, averaging between $300 billion and $350 billion in daily transaction volume, which pales in comparison to the $13 trillion traded daily in the broader US repo market. The outstanding value of tokenized assets is concentrated in credit products and money market funds, with tokenized real-world assets (RWAs) reaching approximately $65 billion as of July, a mere fraction of the $300 trillion in global capital-market assets. Even tokenized equities, which have drawn in investors seeking 24/7 trading and fractional ownership, are less liquid and exhibit roughly 1.5 times the volatility of traditional equities. The IMF noted that the absence of clear legal and regulatory frameworks, coupled with limited interoperability between tokenized and traditional financial systems, could amplify traditional financial risks such as fire sales, liquidity runs, and contagion. To mitigate these risks, the IMF advocates for clearer legal and regulatory structures, enhanced interoperability between tokenized and traditional systems, and safeguards to address emerging vulnerabilities. Despite the risks, the IMF acknowledged that systemic risks remain limited for now due to the limited adoption of tokenized markets. The IMF's concerns echo previous warnings about the potential for automated trading, interconnected smart contracts, and faster settlement to amplify market volatility. European regulators have also voiced similar apprehensions about the risks associated with tokenized equities and the growing links between crypto and traditional finance.",
  "summary": "The global financial institution found tokenized equity markets less liquid and more volatile than traditional markets, despite growing demand for 24/7 trading.",
  "key_points": [],
  "editors_take": null,
  "illustration": null,
  "coverage": {
    "outlets": 1,
    "also_reported_by": []
  },
  "ai_generated": true,
  "disclaimer": "Summaries, key points and the editor’s take are written by software from other outlets’ reporting and may contain errors — always check the linked original."
}