Cryptocurrencies
IMF Warns Tokenized Finance Risks Amplifying Market Crises Ahead
Earlier this year, the New York Stock Exchange said it’s building a venue using blockchain technology to allow for trading tokenized stocks and exchange-traded funds around the clock.
Michael Nagle/Bloomberg
Moving Wall Street’s trading infrastructure onto blockchain-based systems could accelerate financial crises beyond regulators’ ability to respond, even as the technology promises to cut costs and eliminate settlement delays, the International Monetary Fund says.
Tokenization — the act of representing assets like stocks, bonds and cash as digital tokens on shared ledgers — is a structural overhaul of financial architecture rather than a marginal efficiency gain, the IMF’s Tobias Adrian wrote in a report published on Thursday.