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Franklin Templeton Launches On-Chain Money Fund, A Stablecoin Alternative, on Polygon Network with $1.4T AUM

The Defiant | Samuel Haig | Apr 28, 2023

Unsplash Andre Taissin Piggy Bank eating coins - Franklin Templeton Launches On-Chain Money Fund, A Stablecoin Alternative, on Polygon Network with $1.4T AUM

Image: Unsplash/Andre Taissin

Franklin Templeton, the subsidiary of a global investment firm with $1.4T in assets under management, launched its on-chain money fund, a stablecoin alternative, on the Polygon network on Wednesday.

  • Franklin Templeton has launched the Franklin OnChain U.S. Government Money Fund (FOBXX), a U.S.-registered mutual fund that uses the Stellar blockchain for transactions and share ownership recording. The fund aims to provide dividends while maintaining a stable $1 share price by investing primarily in government securities, cash, or repurchase agreements. Roger Bayston, the company's head of digital assets, emphasized that this marks their first integration into the Ethereum ecosystem, as the fund's compatibility with the digital ecosystem is extended through the Ethereum-based Polygon network.
  • The news is the latest sign of increasing institutional interest in Ethereum and its ecosystem following its transition to Proof of Stake consensus last year. Last month’s Shapella upgrades, which activated Staked Ether withdrawals for the first time, have further stoked institutional appetite for Ethereum.
    • Tom Wan, a researcher at crypto ETP provider, 21Shares, tweeted that there were $1B worth of staked Ether inflows over the previous week. “Flow is mainly driven by institutional staking providers,” he said.

See: 

BoE Speech: 4 Areas at the Intersection of Payment Innovation, Tokenization, and Money

Fund Tokenization: Fractional Issuance, Streamlined Redemption, and Servicing Benefits

Colin Butler, head of institutional capital at Polygon Lab:

It’s amazing to have a legacy institution like Franklin Templeton bringing transparency, interoperability, and secure, democratized access to their financial instruments. When we take a step back and look at these things less as blockchain products and more as benefits created by utilizing blockchain rails, we start to see the ‘why.

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