Franklin Templeton Expands On-Chain Money Market Fund

Asset manager Franklin Templeton is expanding its on-chain money market fund onto the Avalanche network. The so-called Franklin OnChain U.S. Government Money Fund (ticker: FOBXX), launched in 2021, was the first U.S.-registered mutual fund to use a public blockchain to record transactions and share ownership.

The BENJI token, accessible through Franklin Templeton’s proprietary investments app, currently trades on the Stellar and Polygon chains. The fund is geared towards institutional and retail investors, who can hold the tokens that represent shares in the $420 million fund. Users can also purchase the tokenized shares via the USDC stablecoin.

“Bringing the Benji platform to the Avalanche network further expands access to our first-of-its-kind tokenized money market fund,” said Roger Bayston, Head of Digital Assets at Franklin Templeton. “We look forward to working with Avalanche’s vibrant developer community to bring new blockchain-enabled innovations into the market.”

The FOBXX fund invests in low-risk U.S. government securities, including fixed, floating, and variable rate securities, in addition to repurchase agreements collateralized fully by U.S. government securities or cash. Like nearly all crypto tokens, BENJI can trade 24/7 and be traded peer-to-peer with minimal restrictions.

FOBXX is the second-largest tokenized fund behind BlackRock’s BUIDL project, which also tracks U.S. government securities. There is currently $1.8 billion worth of tokenized government securities under management, including products by crypto natives like Ondo Finance and OpenEden, according to Dune Analytics.

Franklin Templeton has become increasingly interested in building on blockchains since launching a digital assets division in 2018. This year, for instance, the firm launched exchange-traded funds that track bitcoin (EZBC) and ether (EZET). It launched its tokenized money market fund on Arbitrum, the largest Ethereum Layer 2, two weeks ago.

Avalanche, an alternative smart contract blockchain created by Cornell professor Emin Gun Sirer, is a popular network for real-world asset projects.