How Tokenized Money Market Funds actually work
The tech is new.
The structure is not.
A few key realities behind TMMFs
Legal structure over token design:
- Some are true tokenized MMFs (daily liquidity, Treasuries/repos only).
- Others are private funds for accredited investors, more flexible, less accessible.
Compliance is baked in:
- TMMF tokens don’t move freely.
- Only allow-listed wallets (KYC/AML and eligibility) can hold or transfer.
Token standards enforce the rules:
Permissioned ERC standards check compliance before settlement, not after.
Operational flow is hybrid
Cash/stablecoins. Digital transfer agent. Tokens minted . Off-chain assets invested.
Redemption burns tokens and pays out cash. NAV and pricing still live mostly off-chain.
This isn’t retail DeFi
$1M–$5M minimums are common.
Tokenization doesn’t remove segmentation it encodes it.
Bottom line:
Tokenized MMFs aren’t about “yield on-chain.”
They’re about making regulated fund infrastructure programmable.
The tech is new.
The structure is not.
A few key realities behind TMMFs
Legal structure over token design:
- Some are true tokenized MMFs (daily liquidity, Treasuries/repos only).
- Others are private funds for accredited investors, more flexible, less accessible.
Compliance is baked in:
- TMMF tokens don’t move freely.
- Only allow-listed wallets (KYC/AML and eligibility) can hold or transfer.
Token standards enforce the rules:
Permissioned ERC standards check compliance before settlement, not after.
Operational flow is hybrid
Cash/stablecoins. Digital transfer agent. Tokens minted . Off-chain assets invested.
Redemption burns tokens and pays out cash. NAV and pricing still live mostly off-chain.
This isn’t retail DeFi
$1M–$5M minimums are common.
Tokenization doesn’t remove segmentation it encodes it.
Bottom line:
Tokenized MMFs aren’t about “yield on-chain.”
They’re about making regulated fund infrastructure programmable.
@samboboev great visual thanks
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