Tokenized Money Market Funds Will Make The Next Bank Run Look Like SVB In Slow Motion
The run on SVB was constrained by wire system throughput. Tokenized money settles in seconds. The next regional bank run will move quickly and regulators are ignoring it.
➤ Tokenized money market funds offer faster settlement and higher yields than traditional bank deposits, creating a significant risk of rapid deposit outflows that traditional bank liquidity models do not account for. ➤ The current regulatory response to SVB's collapse has focused on bank-side risks and traditional settlement speeds, overlooking the speed and scale of potential runs facilitated by instant settlement on blockchain rails. ➤ Regulators face a critical window to address the 'deposit-flight' risk posed by tokenized assets before a major incident forces a reactive, fragmented regulatory framework.











