JPMorgan says tokenized money market funds unlikely to grow beyond 15% of stablecoin market

JPMorgan analysts have projected that tokenized money market funds are unlikely to capture more than 15% of the total stablecoin market share in the near term. While interest in tokenized assets has surged, the report highlights that stablecoins remain the preferred instrument for on-chain liquidity and decentralized finance (DeFi) activities. The bank notes that stablecoins offer superior utility for trading and collateralization compared to tokenized money market funds, which are often restricted by regulatory frameworks and lack instant liquidity. Despite the growth of platforms like BlackRock’s BUIDL, JPMorgan suggests that the friction associated with traditional financial asset settlement limits their ability to compete directly with stablecoins. The analysis emphasizes that stablecoins currently benefit from a first-mover advantage and deep integration across various blockchain ecosystems. Consequently, tokenized money market funds are expected to serve as a niche product for institutional investors seeking yield rather than a replacement for stablecoins. This outlook underscores the ongoing tension between traditional financial instruments and native digital assets in the evolving RWA landscape.

✨AI-generated summary — read the full article at the source for complete details.