# RWA Daily Update - 2026-10-04

## Lesson title

Transparency can make a rush for the exit faster

Access date: October 4, 2026 (PDT).
Publication: https://managingexpectations.net/rwa.html

## Authoritative source checked

Basel Committee on Banking Supervision, Working Paper 44, "Novel risks, mitigants and uncertainties with permissionless distributed ledger technologies", August 28, 2024.

- Landing page: https://www.bis.org/bcbs/publ/wp44.htm
- Full official PDF successfully retrieved and text-extracted: https://www.bis.org/publications/novel-risks-mitigants-and-uncertainties-permissionless-distributed-ledger-technologies.pdf
- Relevant passage: section 2.4.1, "Liquidity risk and the 'paradox of transparency'", printed page 6 (PDF page 12).
- Source status: primary institutional research publication. The paper expressly says the authors' views do not necessarily represent the official views of the Committee, its members or the BIS. Not a binding rule or a current issuer assessment.

## Extracted facts and claim mapping

1. The authors write: "Transaction visibility may spur or exacerbate runs on the cryptoassets on the permissionless blockchain". Supports the lesson's conditional claim that visibility can accelerate withdrawals; does not establish that all public-ledger assets experience runs.
2. The same paragraph says visibility "may also act as a coordination device among users whose incentive to withdraw increases when other users do so." Supports the plain-English explanation of holders responding to visible exits.
3. The paper cites research on the Terra/Luna crash (Liu et al., 2023, footnote 13). This run mechanism is reported as the working paper's account of research; the underlying study was not independently reviewed today. No direct equivalence to regulated tokenized funds or bonds is asserted.
4. The paragraph adds that decentralised, non-contracted validators may be unable to coordinate liquidity-risk mitigation during stress. No recommendation to limit withdrawals or assertion of issuer authority to do so is made in the lesson.

## Educational interpretation, not an observed incident

The example of fast visible transfers versus an issuer needing time to sell assets or arrange cash is an explicitly illustrative RWA scenario. It is not a report of a current failure. Transfers and redemption requests are different events; ledger activity alone does not establish a run, cash demand or insolvency.

Questions about issuer cash resources, redemption timing and stress communications are practical due-diligence prompts derived from the risk mechanism. Actual rights and restrictions depend on the specific product documents and applicable law.

## No-hype summary

More visible transactions can improve scrutiny without improving an issuer's ability to meet simultaneous cash requests. Transparency should be paired with liquidity planning and clear redemption terms, not treated as a guarantee of safety or funding. A token does not automatically create ownership, liquidity, legality or yield.

## Practical watch question

If everyone can see others heading for the exit, what funds redemptions - and on what timetable?

## Novelty and scope

Reviewed the existing dated lesson titles and searched the source-note library for the transparency/run coordination mechanism. This is distinct from the September 26 transaction-congestion lesson, September 29 recovery/resolution lesson and October 3 token-permission versus validator-permission lesson. It reuses a reliable source for a previously uncovered substantive concept; it is not presented as newly released news.

No investment advice, price prediction, buy/sell direction, return estimate or claim about a particular issuer is included.

## Retrieval notes and limitations

- The official landing page was readable through web extraction.
- Web extraction of https://www.bis.org/bcbs/publ/wp44.pdf returned only front matter and an incomplete text extract.
- Direct Python retrieval of that legacy PDF URL returned HTML rather than PDF, causing pypdf to reject it. No facts were based on that failed retrieval.
- The official descriptive PDF URL above returned a valid %PDF- header and was successfully parsed with pypdf. The relevant printed page was inspected directly.
- No browser/visual inspection tool was available in this run. Deployment verification uses remote markers, public HTTP responses, content matching and sitemap XML checks.