Franklin Templeton Launches Tokenized Money-Market Fund

• Franklin Templeton launched Hong Kong's first tokenized money-market fund, which invests in short-term US government securities.

• This fund, initially open to institutional investors, uses blockchain to enhance transparency and transaction efficiency.

• A retail version is planned pending SFC approval, which will expand access to tokenized investment products in Hong Kong.

• According to a report in the South China Morning Post, the Franklin Onchain US Government Money Fund invests in short-term US government securities, whose shares are represented as blockchain tokens.

• Franklin Templeton has launched a tokenized fund targeting the retail market.

• Initially open to institutional and professional investors with assets of at least HK$8 million (US$1 million), the fund aims to increase transparency and efficiency by using distributed ledger technology to process transactions and record ownership.

• Franklin Templeton's Asia-Pacific head, Tariq Ahmad, said, "This launch demonstrates our commitment to providing innovative investment solutions and expanding access to tokenized products in this dynamic market."

• He further added that the company plans to introduce a retail-approved version after receiving approval from Hong Kong's Securities and Futures Commission (SFC), as part of its effort to democratize digital asset investment.

• The launch of this fund is the first initiative under the Fintech 2030 plan, which was unveiled earlier this week by Eddie Yu Wai-man, Chief Executive Officer of the Hong Kong Monetary Authority (HKMA).

• The five-year roadmap includes over 40 projects to accelerate the adoption of tokenization, artificial intelligence, and central bank digital currencies (CBDCs) in Hong Kong's financial sector.

• Franklin Templeton has developed the blockchain platform hosting the new fund and has partnered with HSBC and OSL Group, operator of Hong Kong's first licensed virtual asset exchange, through the HKMA's Project Ensemble.

• HSBC is exploring the use of tokenized deposits to enable near-instant settlement for fund transactions, a key step towards building a fully integrated digital asset infrastructure.

• "Hong Kong is emerging as an institutionally trusted hub for digital assets," said Brian Chen, Head of OSL Wealth Management.

• Franklin Templeton has been building its blockchain capabilities since 2018, launched the world's first US-registered blockchain-integrated mutual fund in 2021 and has since launched several tokenized UCITS products in Luxembourg and Singapore.