IMF warns tokenization could bring crypto risks into global financial markets

Tokenization could amplify volatility through automated markets and smart contracts, the report said. What to know : Tokenization could reshape finance by enabling instant settlement and cutting out intermediaries, and introduces new risks that regulators are not yet equipped to manage, the IMF said. Tokenization could amplify volatility through automated markets and smart contracts, the report said. The IMF called for clearer legal frameworks and stronger global coordination, warning that tokenized assets moving instantly across jurisdictions could complicate oversight and deepen financial fragmentation in the absence of proper regulation.(Coindesk)