IMF warns tokenized markets could amplify risks as equity trading stays thin
In brief
- Tokenized equities showed roughly 1.5 times the realized volatility of traditional counterparts, the IMF said.
- Tokenized real-world assets reached about $65 billion as of July, per the IMF.
- More than half of tokenized equity trading occurred outside regular US market hours.
- Systemic risks remain limited for now because adoption is still small, the IMF said.
Small, but growing fast
The IMF said tokenized financial markets are growing rapidly but remain small compared with traditional markets, according to Cointelegraph's account of the analysis. Tokenized real-world assets reached approximately $65 billion in outstanding value as of July, which is a small fraction of the roughly $300 trillion in global capital-market assets. Credit was the biggest slice at $30.4 billion, followed by money market funds at $17.5 billion.
Tokenized equities? About $2.3 billion.
Repos are where the volume is. Tokenized repurchase agreements averaged $300 billion to $350 billion in daily transaction volume, the IMF said (compared with roughly $13 trillion traded daily in the broader US repo market).
Who's trading tokenized stocks, and when
The IMF found that more than half of tokenized equity trading happened outside regular US market hours, and roughly 80% of trades involved less than one share. Overnight price moves in tokenized equities showed up in traditional stock prices shortly after the open. The IMF said that suggests these markets could provide useful price signals when exchanges are closed.
That doesn't make them deep markets, though. The fund said tokenized equities were significantly less liquid and showed about 1.5 times the realized volatility of traditional shares. It also cited poor interoperability and the lack of widely accepted settlement assets as key obstacles to expansion, and said legal uncertainty and financial stability risks could hinder wider adoption.
"Tokenization may yet transform finance, but its future will be determined less by technological possibilities than by policies that ensure market depth, trust, and sound safeguards," the IMF authors wrote in Thursday's blog post.
A string of warnings
The IMF called for clearer legal and regulatory frameworks and better interoperability between tokenized and traditional systems, along with safeguards against emerging vulnerabilities. It isn't the first time the fund has raised these concerns. According to Cointelegraph, the IMF warned in November 2025 that automated trading and interconnected smart contracts could amplify volatility and flash crashes; in April it cautioned that faster settlement could accelerate financial stress, and a July analysis flagged systemic risks from fragmented platforms and weak regulatory coordination.
The European Securities and Markets Authority has sounded a similar alarm. Cointelegraph reported that ESMA warned last month that growing links between crypto and traditional finance, including through tokenized equities, could increase the risk of shocks spreading across markets.
Frequently asked questions
How big is the tokenized asset market according to the IMF?
Tokenized real-world assets reached approximately $65 billion in outstanding value as of July, according to the IMF. That's a small fraction of roughly $300 trillion in global capital-market assets. Tokenized credit accounted for $30.4 billion, money market funds for $17.5 billion and tokenized equities for about $2.3 billion.
Why does the IMF see risk in tokenized equities?
The IMF said tokenized equities were significantly less liquid and showed roughly 1.5 times the realized volatility of traditional counterparts. It warned that as tokenized markets grow, greater interconnectedness and leverage could amplify risks including fire sales, liquidity runs and contagion. The report noted systemic risks remain limited for now because adoption is still relatively small.
