Tokenised Money Market Funds: The Quiet Takeover of Cash Management
“The biggest shift in finance is not happening in risk assets. It’s happening in cash.” — DNA Crypto.
Most tokenisation narratives focus on assets.
– Art.
– Property.
– Collectibles.
Institutions are focused somewhere else entirely.
They are tokenising cash.
Tokenised money market funds (MMFs) represent the most consequential form of real-world asset tokenisation to date, not because they are novel, but because they sit at the centre of how modern finance actually functions.
Why Tokenised MMFs Matter More Than Tokenised Assets
Money market funds already underpin:
- – Corporate treasury operations
- – Prime brokerage margining
- – Cash sweeps
- – Short-term liquidity buffers
Putting these instruments on-chain does not change their economic role. It changes their operational velocity.
This is why DNACrypto has consistently argued that tokenisation’s real impact is at the infrastructure layer, not the ownership layer, as explored in Why Tokenisation Changes How Finance Wins, Not Who Wins.
Cash is where friction compounds fastest.
From End-of-Day to Intraday Liquidity
Traditional MMFs settle on legacy rails.
T+0 or T+1 is considered fast.
Intraday liquidity is constrained.
Collateral is locked unnecessarily.
Tokenised MMFs allow:
- – Near-instant subscription and redemption
- – Intraday collateral mobility
- – Continuous liquidity monitoring
This shift mirrors the broader transition described in Real-World Asset Tokenisation in 2025.
The benefit is not yield… It is time.
“Instant Liquidity with Yield” and Its Consequences
When cash becomes both yield-bearing and instantly movable, existing structures feel pressure.
Prime brokers face:
- – Reduced idle balances
- – Faster collateral substitution
- – Higher expectations around margin efficiency
Corporate treasurers gain:
- – Better cash visibility
- – Faster deployment
- – Fewer trapped balances
This is not theoretical. It is already reshaping how institutions think about cash as a strategic asset rather than a passive one.
Why Institutions Are Moving Quietly
The most crucial detail is how quietly this shift is occurring.
– Tokenised MMFs are not marketed to retail.
– They are integrated into existing institutional workflows.
This mirrors DNACrypto’s observations in BlackRock’s Tokenization Vision, where scale arrives through operational integration, not hype cycles.
Cash moves first because it touches everything.
Where the Real Risks Are
Tokenised MMFs are not risk-free.
Institutions focus on four areas:
Custody
Who controls the tokens and underlying assets?
How are key management and segregation enforced?
Operational resilience
What happens during outages, forks, or network congestion?
Legal finality
Is on-chain redemption legally equivalent to off-chain settlement?
Stress scenarios
How do tokenised MMFs behave during rapid redemptions or market stress?
These questions echo DNACrypto’s broader emphasis on settlement trust and dependency risk across digital finance infrastructure.
Regulation Matters More Than Technology
Tokenised cash without regulatory clarity is unusable at scale.
This is why adoption concentrates in jurisdictions with clear frameworks, a trend discussed in UK Labour Victory Boosts Tokenization and CBDC.
Institutions do not chase innovation… They adopt what survives scrutiny.
The DNACrypto View
Tokenised money market funds are not a crypto story.
They are a cash management story.
They succeed because they improve settlement, liquidity, and control without requiring institutions to change behaviour; only infrastructure is needed.
This is how real financial change happens.
Quietly.
Incrementally.
And at the core of the system.
Image Source: Envato Stock
Disclaimer: This article is for informational purposes only and does not constitute legal, tax or investment advice.
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