{
  "title": "Financial Market Infrastructures Evolution in a Tokenized Economy: Exploring blockchain implementation options for issuance, central clearing, settlement, and reporting",
  "publication": "IMF Working Papers, July 2, 2026",
  "sourceUrl": "https://www.imf.org/en/publications/wp/issues/2026/07/01/financial-market-infrastructures-evolution-in-a-tokenized-economy-577325",
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  "summary": "This paper examines how tokenization and distributed ledger technology may transform Financial Market Infrastructures (FMIs) by enabling smart contracts to perform a growing share of functions traditionally undertaken by central securities depositories, central counterparties, and trade repositories",
  "sections": [
    {
      "heading": "Core summary",
      "content": "- Examines how tokenization and distributed ledger technology (DLT) may transform Financial Market Infrastructures (FMIs) by enabling smart contracts to perform a growing share of functions traditionally undertaken by central securities depositories, central counterparties, and trade repositories.\n- Argues that record-keeping, settlement, collateral management, and reporting can increasingly be executed on-chain, while key functions requiring legal certainty, governance, accountability, and discretion remain institutional in nature.\n- Concludes that tokenization is more likely to reconfigure than eliminate FMIs, producing new efficiencies alongside novel operational and governance risks, with the most plausible outcome being a hybrid FMI model in which technology and institutions jointly provide trust, resilience, and oversight required for financial stability."
    },
    {
      "heading": "Key findings",
      "content": "- Activities amenable to migration to code:\n  - Record-keeping\n  - Settlement\n  - Collateral management\n  - Reporting\n- Activities likely to remain institutional:\n  - Functions requiring legal certainty\n  - Governance\n  - Accountability\n  - Discretionary decision-making\n- Net effect of tokenization:\n  - Reconfiguration rather than elimination of FMIs\n  - Creation of new efficiencies\n  - Introduction of novel operational and governance risks"
    },
    {
      "heading": "Risks and limitations identified",
      "content": "- Operational risks stemming from on-chain execution of FMI functions\n- Governance risks as responsibilities shift between code and institutions\n- Legal and accountability limitations that constrain full migration of FMI functions to smart contracts\n- Evolution of risk profiles in tokenized environments that combine technological and institutional vulnerabilities"
    },
    {
      "heading": "Policy implications and recommendations (as conveyed by the analysis)",
      "content": "- Anticipate a hybrid FMI model combining technological capabilities (smart contracts, on-chain processes) with institutional functions (legal frameworks, governance, oversight).\n- Preserve institutional roles where legal certainty, governance, accountability, and discretion are required.\n- Design oversight, resilience, and trust frameworks that integrate code-based automation with institutional governance to maintain financial stability."
    },
    {
      "heading": "Publication and metadata",
      "content": "- Authors: Yaiza Cabedo, Tommaso Mancini-Griffoli, Fabian Schär, Nicolas Zhang\n- Date: July 2, 2026\n- Series: Working Paper No. 2026/136\n- Volume: 2026\n- Issue: 136\n- Pages: 52\n- DOI: https://doi.org/10.5089/9798229051354.001\n- Stock No: WPIEA2026136\n- ISBN: 9798229051354\n- ISSN: 1018-5941\n- Subject tags: Blockchain and DLT, Central securities depositories, Collateral, Financial institutions, Financial markets, Securities, Smart contracts, Technology\n\nIMF Working Paper: \"Financial Market Infrastructures Evolution in a Tokenized Economy: Exploring blockchain implementation options for issuance, central clearing, settlement, and reporting\" (Working Paper No. 2026/136), July 2, 2026.\n\n---\n\n Content in this bundle\n\n- Working Paper\n  - Working Paper (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - Working Paper (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2026/07/01/financial-market-infrastructures-evolution-in-a-tokenized-economy-577325"
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    "Authors: Yaiza Cabedo, Tommaso Mancini-Griffoli, Fabian Schär, Nicolas Zhang",
    "Published: July 2, 2026",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9798229051354.001",
    "Examines how tokenization and distributed ledger technology (DLT) may transform Financial Market Infrastructures (FMIs) by enabling smart contracts to perform a growing share of functions traditionally undertaken by central securities depositories, central counterparties, and trade repositories.",
    "Argues that record-keeping, settlement, collateral management, and reporting can increasingly be executed on-chain, while key functions requiring legal certainty, governance, accountability, and discretion remain institutional in nature.",
    "Concludes that tokenization is more likely to reconfigure than eliminate FMIs, producing new efficiencies alongside novel operational and governance risks, with the most plausible outcome being a hybrid FMI model in which technology and institutions jointly provide trust, resilience, and oversight required for financial stability.",
    "Activities amenable to migration to code:",
    "Activities likely to remain institutional:",
    "Net effect of tokenization:",
    "Operational risks stemming from on-chain execution of FMI functions",
    "Governance risks as responsibilities shift between code and institutions",
    "Legal and accountability limitations that constrain full migration of FMI functions to smart contracts",
    "Evolution of risk profiles in tokenized environments that combine technological and institutional vulnerabilities",
    "Anticipate a hybrid FMI model combining technological capabilities (smart contracts, on-chain processes) with institutional functions (legal frameworks, governance, oversight).",
    "Preserve institutional roles where legal certainty, governance, accountability, and discretion are required.",
    "Design oversight, resilience, and trust frameworks that integrate code-based automation with institutional governance to maintain financial stability.",
    "Authors: Yaiza Cabedo, Tommaso Mancini-Griffoli, Fabian Schär, Nicolas Zhang",
    "Date: July 2, 2026",
    "Series: Working Paper No. 2026/136",
    "Volume: 2026",
    "Issue: 136",
    "Pages: 52",
    "DOI: https://doi.org/10.5089/9798229051354.001",
    "Stock No: WPIEA2026136",
    "ISBN: 9798229051354",
    "ISSN: 1018-5941",
    "Subject tags: Blockchain and DLT, Central securities depositories, Collateral, Financial institutions, Financial markets, Securities, Smart contracts, Technology",
    "**Working Paper**"
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