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BIS warns of liquidity risks in tokenized currency market funds, and industry technical solutions are beginning to emerge.
Golden Finance reports that the Bank for International Settlements (BIS) has released a brief stating that there is a liquidity mismatch risk between daily redemptions and T+1 settlements for tokenized money market funds (MMFs), which is particularly pronounced under market stress.
However, solutions are already emerging in the industry, such as Broadridge's DLR system, which enables the intraday transfer and monetization of government bonds, providing a technical path to alleviate liquidity mismatches.
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