WisdomTree Gains Nod for Instant Settlement of Tokenized Money Market Fund

WisdomTree announced the launch of 24/7 trading and instant settlement capabilities for its tokenized money market fund after obtaining exemptive relief from the SEC and FINRA. WisdomTree said in a press release that this is the first time “registered tokenized mutual fund shares have been permitted to trade and instantly settle 24/7 within the U.S. regulatory perimeter via a dealer-principal liquidity model.” Instant settlement lets investors move into yield-bearing assets in real time, eliminating delays of traditional markets, reducing cash drag and unlocking the efficiency and liquidity advantages of tokenized assets. WisdomTree’s announcement comes as the SEC appears poised to consider facilitating limited trading of certain tokenized securities with an eye toward developing a long-term regulatory framework, as Chairman Paul Atkins recently said.

Separately, an article from law firm Baker McKenzie explains how tokenization is enabling asset managers to create a new class of products. The article explains that tokenization, which is the process of creating unique digital representations of assets, can reduce costs thanks to automation and reduce the need for intermediaries. Tokenized funds can offer investors wider accessibility to funds, greater transparency about returns, transaction history and other key details, according to the article. Money market funds have captured most of the focus in tokenization mainly because of their low risk and high liquidity. 

Click here to read the WisdomTree press release.

Click here to read SEC Chair Paul Atkin’s remarks on tokenized securities.

Click here to read a client alert from Baker McKenzie.