In a significant move, Franklin Templeton has announced the tokenization of its US Government Fund on the Polygon and Stellar blockchains.
The fund’s tokenization will allow Franklin OnChain FOBXX investors to transfer the fund’s BENJI token between themselves without an intermediary.
Franklin Templeton Embraces Blockchain Technology
Franklin Templeton’s embrace of blockchain technology can enable peer-to-peer transfers for shares in its Franklin OnChain United States Government Money Fund (FOBXX) using the BENJI token. One BENJI token acts as a share of the Franklin OnChain U.S. Government Money Fund and is currently available on Polygon and Stellar. With each share now represented by the BENJI token, Franklin Templeton now leads the tokenized US Treasuries niche with a 32% market share representing $384 million in assets, according to data from asset management company 21co. Franklin Templeton Head of Digital Assets Roger Bayston said in a statement,
“We are excited that BENJI token holders will have the ability to transfer shares amongst each other. Eventually, we hope for assets built on blockchain rails, such as the Franklin OnChain U.S. Government Money Fund, to work seamlessly with the rest of the digital asset ecosystem.”
Franklin Templeton was the first US-registered fund to use a public blockchain to process transactions and record share ownership. Currently, the total assets under management in tokenized government securities is around $1.2 billion.
Competing With BlackRock
Franklin Templeton’s new initiative comes in an increasingly competitive environment, especially with BlackRock’s new BUIDL fund emerging as a formidable competitor. BlackRock’s BUIDL fund is tokenized in collaboration with Ethereum and has captured 25% of the market only a month after its launch. The fund currently has $304 million in assets and is quickly eating into Franklin Templeton’s market share.
Competition between the two is set to intensify as the investment giants look to establish their dominance in the tokenized US securities niche. Franklin Templeton’s tokenization of its US Government Funds also marks a strategic move toward enhancing greater connectivity within the digital asset ecosystem.
Through the peer-to-peer transfer of the BENJI token, Franklin Templeton is looking to broaden the fund’s utility and give investors greater facility in managing their assets, underscoring the firm’s commitment to leveraging blockchain technology to innovate and adapt to changing market trends.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
