Law Firm on Ireland, Tokenised Funds
Law firm Pinsent Masons writes "Ireland can capitalise on growth of tokenised funds," which says, "Ireland has an opportunity to translate its established leadership in money market funds and fund servicing into a leading position in the emerging market for tokenised funds. As tokenisation moves from proof of concept to commercial reality, policymakers, regulators and industry participants are increasingly focused on how distributed ledger technology could transform the way fund ownership is recorded, transferred and serviced." The piece continues, "The European Central Bank estimated the global market for tokenised money market funds was approximately €7 billion at the end of 2025, having roughly doubled during that year. Its conclusion confirms that the market remains small relative to conventional funds, but it is expanding rapidly and demonstrates genuine demand, particularly for liquidity management and collateral use." It asks, "What is a tokenised money market fund? A tokenised money market fund is a regulated investment fund that invests in short-term, high-quality assets. The distinction is that its shares are recorded using distributed ledger technology (DLT). A token evidences an investor's shareholding in a fund, typically on a one-token-per-share basis. The token is neither a stablecoin nor a new economic asset; it is a digital representation of an existing fund share. The fund itself remains subject to the existing regulatory framework, including Regulation (EU) 2017/1131 (the Money Market Funds Regulation). Importantly, the tokenisation of a fund share does not alter its regulatory status." Finally, the update adds, "To date, the representation of fund shares in Ireland as tokens has used the digital twin model. In this model a money market fund is constituted in the normal manner, and a register of shareholders is maintained by the administrator as the definitive record of ownership."
