- Tokenisation may boost efficiency but introduces faster crises, regulatory gaps, and stability risks.
- IMF warns tokenisation could weaken response to stress events, leading to a crisis.
The International Monetary Fund (IMF) has warned against tokenisation, a news report revealed. IMF notes that putting real-world assets like money, bonds, and funds on blockchain could transform finance but also introduce major risks.
Tobias Adrian, the financial counsellor and director of the monetary and capital markets department, shared in a statement:
“Stress events are likely to unfold faster, leaving less time for discretionary intervention.”
According to Adrian, while tokenisation enables a faster, “atomic” settlement and reduces reliance on intermediaries, it requires organisations to manage liquidity in real time. He points out that settlement delays give central banks and regulators time to intervene during a crisis. By allowing faster settlements, tokenisation could leave less room to respond during a crisis.
IMF highlights stablecoins as a key link between crypto and traditional finance, but notes that their stability depends on reliable reserves and redemptions. It also cautions that automation and smart contracts could accelerate market downturns, triggering rapid liquidation.
The organisation urges stronger legal frameworks and global coordination to prevent instability and fragmentation as tokenisation grows.
See Related: El Salvador To Drop Law Requiring Businesses To Accept BTC In Deal With IMF
How Tokenisation Is Reshaping The Future Of Investment
Tokenisation could transform the future of investment by converting real-world and digital assets into blockchain-based tokens. According to industry experts, the shift is expected to improve liquidity, as tokenised assets can be traded more easily.
Agostino Capponi, a Professor of Industrial Engineering and Operations Research at Columbia University, shared in a statement:
“Assets that are traditionally illiquid – art, music, real estate – are very hard to transact, or transacted only very rarely. But once they are tokenised, which means that you have a digital representation of these assets, they can be traded more easily.”
The comments come when leading global exchanges such as Nasdaq and NYSE are seeking approval to tokenise traditional assets like stocks. As adoption grows, tokenisation is projected to redefine how investors diversify portfolios, access markets, and interact with financial systems globally.
