Tokenized MMF · A2A Rails · Institutional Treasury
USD-denominated tokenized money market funds already exist and are attracting significant institutional capital. What does not broadly exist - and where Post Oak Labs sees particular institutional opportunity - is local-currency tokenized MMFs in non-dollarized emerging markets, deployed on A2A payment rails as a combined institutional product. A corporate treasurer in Bogota, Lagos, or Kingston who cannot easily access USD instruments deserves the same overnight yield management tools that treasurers in New York take for granted. This page explains the product architecture, the revenue model for the originating bank, and the regulatory considerations across target jurisdictions.
The Gap in the Market
The corporate treasurer at a mid-size company in Colombia, Nigeria, or Jamaica faces a liquidity management problem that their counterpart in New York solved decades ago. Idle cash in an operating account earns nothing. Money market funds provide overnight yield. But for a treasurer who cannot or should not hold USD-denominated instruments, access to local-currency short-duration yield vehicles is limited, slow, and often structurally unavailable via the bank's digital channels. Tokenized infrastructure solves this.
The FX Risk Problem
A company with COP-denominated revenues and COP-denominated payables should not be holding idle cash in USD money market funds. The FX conversion cost going in and coming out erodes the yield benefit entirely for short-duration positions. What these companies need is a COP-denominated instrument - the same short-duration, high-quality, liquid exposure that a USD MMF provides but in their functional currency. This product does not exist at scale in Colombian institutional banking today.
Revenue exposure: FX round-trip at ~1-2% erases yield on <30-day positions
The Capital Controls Problem
Nigeria's CBN FX regulations, Jamaica's historical FX management framework, and similar regimes in target markets mean that corporate access to USD instruments involves regulatory overhead, time delays, and compliance costs that make short-duration overnight positions impractical. A local-currency tMMF deployed domestically, on a domestically-regulated ledger, sidesteps these constraints entirely. The treasurer holds a claim on a local-currency short-duration instrument, redeemable on the same ledger, without any cross-border capital movement.
Regulatory friction: capital controls add 1-5 business day delay to USD access
The Yield Access Problem
Local-currency overnight rates in Colombia (7-8% in 2024-2025), Nigeria (22-26% overnight policy rate context), and Jamaica (6-7%) represent meaningful yield for corporate treasurers. But accessing this yield via traditional instruments requires T+1 or T+2 fund redemption, minimum investment thresholds, and manual processes that make short-duration positions operationally impractical. A tokenized MMF with same-day A2A redemption changes the operational calculus entirely: the treasurer can sweep idle operating account cash into the tMMF position each evening and redeem it each morning at zero friction.
Yield opportunity: 100 basis points annualized = $100K on $10M operating balance
Existing Landscape
Understanding where the market is already developed is important for positioning a local-currency tMMF product correctly. The opportunity is not to compete with BlackRock BUIDL in USD - it is to serve the market that USD tMMFs structurally cannot serve.
On the existing tMMF market
USD-denominated tokenized money market funds are real, funded, and growing. BlackRock's BUIDL, Franklin Templeton's BENJI, Ondo Finance's OUSG, and others provide institutional-grade tokenized exposure to US Treasury bills and money market instruments. These products are useful and well-executed. They are not the opportunity described in this document. The opportunity here is the structural gap: the equivalent product for local-currency corporate treasurers in non-dollarized emerging markets does not exist in institutional-grade tokenized form anywhere Post Oak Labs is aware of as of early 2026.
| Product | Issuer | Currency | Underlying | AUM (approx.) | Redemption | Gap Addressed Here |
|---|---|---|---|---|---|---|
| BUIDL | BlackRock / Securitize | USD | US Treasuries, repo | $1B+ (2024)[1] | T+0 on-chain, T+1 off-chain | No - USD only, not accessible to COP/NGN/JMD treasurers |
| BENJI | Franklin Templeton | USD | US Government MMF | $500M+ (2024)[4] | T+1 (Benji app) | No - USD only |
| OUSG | Ondo Finance | USD | BlackRock SHV ETF | $200M+ (2024) | T+0 on-chain via instant redemption | No - USD only, DeFi-native structure |
| Local-Currency tMMF on A2A | Originating commercial bank (to be built) | COP / NGN / JMD / etc. | Local-currency short-duration sovereign instruments, bank deposits, CDs | Not yet in market at scale | T+0 via A2A rail redemption | Yes - this is the product architecture described here |
Product Architecture
The product architecture combines two components that the originating bank likely already operates in some form: a regulated collective investment scheme or money market fund vehicle on one side, and a tokenized A2A payment rail on the other. The innovation is not inventing either component, it is connecting them on the same ledger.
The underlying fund: a locally-regulated collective investment scheme holding short-duration local-currency instruments. The fund invests in short-duration local-currency sovereign instruments (government treasury bills, central bank repos, or equivalent), commercial bank certificates of deposit, and high-grade local-currency commercial paper. The fund is regulated as a collective investment scheme under the local jurisdiction's CIS law - this is the licensing requirement that most varies across markets (see Regulatory section). The fund manager is the originating bank or its asset management subsidiary. The fund generates overnight yield from the short-duration instruments. This is structurally identical to a traditional money market fund - the tokenization layer sits above it, not inside it.
Fund units represented as tokens on the permissioned ledger. Each unit (or fraction) of the fund is represented as a token on the same permissioned ledger that hosts the A2A payment rail. The token is a digital claim on a fund unit - legally, the underlying instrument is the fund unit; the token is the bearer mechanism for that claim on the ledger. Token minting occurs when a corporate client moves funds from their operating account into the tMMF position via A2A instruction. Token redemption occurs when the corporate instructs the fund to redeem - the token is burned, and local-currency fiat is credited back to the operating account via the A2A rail. Both operations settle in real time on the same ledger, making the round-trip overnight cycle operationally trivial.
The A2A rail as distribution and redemption mechanism. The A2A payment rail serves two functions in this architecture: first, as the distribution channel through which the corporate client moves funds from operating account to tMMF position; and second, as the redemption channel through which the tMMF position is liquidated back to the operating account. Because both the operating account balance and the tMMF position exist on the same ledger, the minting and redemption operations are atomic - they succeed completely or fail completely with no settlement risk. There is no T+1 settlement window. No wire transfer. No manual process. The corporate treasury team runs it from the bank's existing digital banking interface.
Custody of the underlying assets: the most jurisdiction-sensitive element. The underlying fund assets - treasury bills, repos, CDs - are held in custody by the originating bank's custody subsidiary, a third-party custodian, or the central bank's securities depository (in markets where this is available). The custody structure must satisfy the local CIS regulatory requirements for asset segregation. In most target markets (Colombia, Nigeria, Jamaica), this means the fund assets must be held in a segregated custody account that is legally separate from the bank's proprietary assets - protecting fund investors if the bank encounters financial difficulty. The on-ledger token represents the custodied fund unit; the legal structure runs through the custody arrangement, not the ledger.
Daily Operating Flow
The following describes a standard overnight cycle for a corporate treasury client using the tMMF product. The entire sequence runs on the bank's digital banking interface. The treasury team never interacts with the fund directly - only with the bank's familiar payment and account management tools.
Corporate treasury sweeps idle operating account cash into tMMF position. The treasury team identifies the amount of idle cash that will not be needed for overnight obligations. Via the bank's digital banking portal (or automated cash management rules), they instruct a transfer from the operating account to the tMMF position. The bank's A2A rail receives this instruction, mints the equivalent value in tMMF tokens, and debits the operating account balance. The operation settles in real time on the ledger. The corporate now holds tokenized fund units representing a claim on overnight yield from the underlying short-duration instruments. The entire operation takes under 30 seconds from instruction to confirmation.
Fund earns yield on underlying instruments; accrues to token holders. While the corporate's tMMF tokens sit on the ledger overnight, the fund's underlying assets - treasury bills, repos, CDs - earn yield. This yield accrues to the token holders in proportion to their holdings. The yield accrual mechanism is either (a) reflected in the net asset value per token (accumulating fund structure, where the token value increases) or (b) distributed as a separate yield token or operating account credit (distributing fund structure). The choice between these structures has regulatory and tax implications that vary by jurisdiction.
Corporate redeems tMMF tokens back to operating account before markets open. The treasury team (or automated rules) instructs redemption of the tMMF position back to the operating account before market open. The A2A rail burns the tokens, redeems the equivalent fund units, and credits local-currency fiat back to the operating account. The corporate receives: the original principal plus overnight yield less management fees. The operating account is back to full working capital position before the business day begins. The entire round-trip - subscription the prior evening, redemption the following morning - has generated real yield with no manual overhead, no T+1 delay, and no FX conversion.
What this produces for a corporate treasurer: A company with a $10M COP-equivalent operating balance at a 7% local overnight rate (approximate Colombia 2024 policy environment) earns approximately $700K annually by sweeping idle cash into a tMMF overnight. A traditional money market fund with T+1 redemption captures approximately 70% of this yield opportunity (the overnight cycle is partially lost due to settlement delays). A tokenized tMMF on A2A rails with T+0 redemption captures close to 100% of it. At scale across a bank's commercial lending book, this product transforms treasury cash management for a large segment of the bank's corporate clients who currently earn nothing on idle operating balances.
Revenue Model
The combined tMMF + A2A product creates revenue for the originating bank across three distinct streams. Each is defensible and high-margin. Together they represent a more attractive economics profile than either the fund or the payment rail would generate independently.
Revenue Stream 01
Standard money market fund management fee, typically 15-30 basis points annually on AUM for institutional-grade local-currency MMFs. The bank's asset management subsidiary (or fund management arm) earns this fee as the fund manager. As corporate clients aggregate tMMF AUM, this becomes a significant fee income line. At $500M in tMMF AUM, a 20bps management fee generates $1M annually in recurring, low-cost-to-serve fee income - without any additional credit risk on the bank's balance sheet.
Typical range: 15-30bps on AUM annually
Revenue Stream 02
The fund holds short-duration instruments that earn overnight yield. The yield distributed to token holders is the net yield after management fees and any spread retained by the fund manager. In markets with policy rates at 6-8%, a 50-100bps spread retained by the bank on a large AUM base represents meaningful additional income. The spread must be disclosed in the fund's offering documents and satisfy local CIS regulatory requirements for fee transparency, but it is a standard feature of money market fund economics.
Typical spread capture: 25-75bps depending on jurisdiction and competition
Revenue Stream 03
For corporate clients with cross-border payment obligations, the tMMF position can serve as a funding source for FX transactions executed on the A2A rail. The corporate redeems tMMF tokens, executes an FX conversion on the A2A ledger at the bank's on-ledger rate, and completes the cross-border payment - all in a single atomic transaction. The bank captures the FX spread on this conversion, a revenue stream that previously went entirely to correspondent intermediaries. For corporate clients with significant cross-border payment volumes, this can be the largest of the three revenue streams.
FX margin: typically 0.5-1.5% on converted volume; captured entirely by originating bank
Regulatory Considerations
The regulatory requirements for a tokenized money market fund are primarily driven by the local CIS (collective investment scheme) regulatory framework, not by digital asset or CBDC regulation. In most target jurisdictions, the tMMF is regulated as what it economically is: a money market fund that happens to have a digital distribution mechanism. The tokenization layer does not create a new regulatory category - it is the fund wrapper that matters.
Not legal advice
The following is a high-level summary of publicly available regulatory frameworks as of early 2026. CIS regulation is highly jurisdiction-specific and changes frequently. Any institution structuring a tMMF product must engage in-country legal counsel before any product launch or fund registration. Post Oak Labs provides advisory guidance on product architecture and regulatory strategy, not legal opinions.
Collective investment schemes regulated under Decreto 2555 (2010) and SFC guidelines. Any vehicle that pools investor funds for collective investment requires authorization from the Superintendencia Financiera de Colombia (SFC) as a Fondo de Inversion Colectiva (FIC). Money market FICs (FICs del Mercado Monetario) are specifically defined and regulated with short-duration investment restrictions, daily liquidity requirements, and maximum WAM limits consistent with international MMF standards. A tokenized distribution mechanism does not change the FIC classification. The SFC issued Circular 014 (2021) providing initial guidance on tokenization of financial instruments; a tMMF distribution via tokenized rails would require SFC consultation and likely a formal guidance request before launch.
Collective investment schemes regulated by the Securities and Exchange Commission (SEC Nigeria) under the Investments and Securities Act (ISA) 2007. Unit trusts and money market funds are established product categories under Nigerian SEC regulation. A tokenized money market fund would need to be structured as a registered unit trust with Nigerian SEC, with the tokenization mechanism disclosed in the scheme's trust deed and offering memorandum. Nigerian SEC issued rules on digital assets in 2022 (SEC Digital Assets Rules) that provide a partial framework for tokenized products but do not specifically address tokenized CIS. Pre-filing consultation with Nigerian SEC is strongly recommended before any product launch.
Collective investment schemes regulated under the Securities Act (2013) by the Financial Services Commission (FSC Jamaica). Money market funds are established product categories under FSC regulation. BOJ's JAM-DEX CBDC infrastructure and the FSC's regulatory sandbox create a relatively favorable environment for a tokenized MMF pilot. The FSC has expressed openness to digital asset product innovation through its sandbox; a bank seeking to pilot a tokenized MMF on A2A rails would likely qualify for sandbox treatment for an initial period before full product registration. The FSC sandbox application process is documented at fscjamaica.org.
Asset segregation is the non-negotiable regulatory requirement across all target markets. Every CIS regulatory framework in Post Oak Labs' target markets requires that fund assets be held in segregated custody legally separate from the fund manager's proprietary assets. For a tMMF, this means the underlying instruments (treasury bills, repos, CDs) must be held by an authorized custodian or the central bank's securities depository in a ring-fenced account. The on-ledger token represents the custodied fund unit. The legal chain is: corporate holds token - token represents fund unit - fund unit is custodied by authorized custodian - custodian holds underlying instruments. Each link in this chain must be legally documented and satisfy local CIS and custody regulation.
Post Oak Labs works with commercial banks that have the foundational components to deploy this product: an existing fund management arm or CIS-licensed vehicle, a digital transformation mandate, and a corporate client base with genuine treasury management needs. If your institution operates in Colombia, Nigeria, Jamaica, Costa Rica, or Trinidad and Tobago and is evaluating tokenized treasury product innovation, we are glad to have a direct conversation about what a combined tMMF + A2A deployment would look like in your specific regulatory and operational context. contact@postoaklabs.com