🏛️ Institutional Crypto: Crypto Liquidity

Institutional investors eye tokenized U.S. equities for off‑hours exposure, yet the IMF warns that such products may dilute liquidity and introduce volatility, especially if underlying asset pools become thin during after‑hours trading. The risk premium could rise, prompting firms to demand higher collateral ratios and tighter margin calls, potentially reducing capital deployment in tokenized equity desks. On the DeFi front, Morpho’s cirBTC borrowing volume surpassed $190 million, reflecting a shift toward leveraged exposure amid tightening liquidity in traditional crypto pools. Arc’s liquidity squeeze underscores that institutional demand for stablecoin‑backed borrowing is outpacing available reserves, which may push lenders to hike rates and demand more diversified collateral. Across the broader market, the top 10 liquidity pools are projected to total $42 billion by 2026, with Uniswap v4 and Fluid leading.