The International Monetary Fund (IMF) stated in a new explainer video on X that tokenized markets could face sharper flash crashes as automation accelerates trading, even as the technology delivers faster and more efficient financial infrastructure.
According to the institution, early pilots in tokenized bonds and money-market instruments show measurable efficiency gains, including reduced settlement times and lower operational costs. These systems rely on programmable workflows rather than multiple intermediaries, an evolution broadly embraced by the crypto industry as a pathway toward more transparent and accessible markets.
However, the IMF warned that interconnected smart contracts may amplify volatility during stress events. The agency also noted that fragmentation across tokenized platforms and uneven global regulation could limit liquidity if left unresolved. Looking ahead, the IMF said governments are unlikely to remain passive as tokenization scales, citing historic moments when states intervened during major monetary transitions.
Source: https://x.com/IMFNews/status/1994201573350629585
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