Moody's: The rapid rise of tokenized funds is accompanied by warning signs.

[Moody's: The Rapid Rise of Tokenized Funds Comes with Warning Signals] Credit rating agency Moody's pointed out in a report on Wednesday that while fund tokenization is thriving, the serious risks associated with it cannot be overlooked by investors. Moody's Vice President and Senior Analyst Cristiano Ventricelli stated that when assessing tokenized funds, investors need to weigh the benefits against the risks brought by underlying technology, security, scalability, and regulatory changes. Moody's mentioned that many fund managers lack experience in the early stages of the tokenization market, have small teams, and short performance records, which poses key person risks, meaning an over-reliance on a few individuals. The departure of key executives or weak governance structures can undermine fund stability, therefore urging fund teams to diversify responsibilities and strengthen risk management. Blockchain interruption is another risk, stemming from technological novelty. While smart contracts can improve operational efficiency, they can be vulnerable to coding defects or malicious attacks.