Franklin Templeton Launches Tokenized Money Fund on Arbitrum

Franklin Templeton Integrates FOBXX with Arbitrum Network

Franklin Templeton, a prominent asset manager, has announced the launch of its tokenized money fund, Franklin OnChain U.S. Government Money Fund (FOBXX), on the Arbitrum network as of August 8, 2024. This move is part of the company’s ongoing efforts to bridge the gap between traditional finance and decentralized finance (DeFi). Initially created in 2021, FOBXX is already accessible through Franklin Templeton’s Benji Investments platform, with support for other networks such as Stellar and Polygon.

What is the Franklin OnChain U.S. Government Money Fund (FOBXX)?

FOBXX is designed to generate low-risk yields by holding highly liquid assets like short-term Treasury bills and commercial paper. As of June 2024, the fund manages approximately $420 million in net assets and has delivered annualized returns of around 5.25%. The inclusion of Arbitrum as a network for tokenized shares is a significant endorsement, suggesting U.S. regulators view Arbitrum’s public ledger as a legitimate tool for financial recordkeeping.

Arbitrum’s Role in Decentralized Finance

Arbitrum, a layer-2 scaling solution on Ethereum, currently holds a total value locked (TVL) of around $14 billion, according to L2Beat data. Roger Bayston, Franklin Templeton’s head of digital assets, highlighted the unique position of FOBXX, stating in a July interview with Cointelegraph, “We are currently the only product with the ability to use public distributed ledger technologies for official transaction record-keeping.”

Strategic Implications of the Arbitrum Launch

Steven Goldfeder, CEO and co-founder of Arbitrum-developer Offchain Labs, emphasized that the launch of FOBXX on Arbitrum aligns with their mission to provide scalable and efficient financial solutions. This expansion represents Franklin Templeton’s latest initiative to enhance the accessibility of tokenized real-world assets (RWAs). The company plans to further extend its reach to new blockchain networks and enable user-managed wallets for its RWAs, as per Bayston’s statement.

Future Plans and the Importance of the Arbitrum Ecosystem

Bayston described the move into the Arbitrum ecosystemCrypto News Today – Unveiling the Astonishing Growth of ETH Ecosystem Users: 9X Surge Since 2020 as “an important step” in Franklin Templeton’s broader journey toward making decentralized financial products more accessible to investors.

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