Bybit and Franklin Templeton Unveil Tokenized Collateral Program

Financial services giant Franklin Templeton has partnered with cryptocurrency exchange Bybit to allow institutional investors to use tokenized shares of its money market funds as trading collateral. The program, which uses Franklin Templeton's Benji platform, lets eligible clients pledge fund shares in off-exchange custody and access credit lines denominated in stablecoins USDT or USDC.

The arrangement is designed to let institutions earn yield on their money market fund holdings while using those assets to finance crypto trading. This comes as demand for tokenized money market funds has grown, with the Bank for International Settlements valuing the market at over $9 billion as of September 2025.

Franklin Templeton's Benji platform had $1.98 billion in assets under management as of April, but this figure has since declined to around $669 million, according to RWA.xyz data. BlackRock's USD Institutional Digital Liquidity Fund (BUIDL) is the largest tokenized money market fund at $2.2 billion and is accepted as collateral on other exchanges.

The companies are also planning a tokenized investment product for wallet users on Bybit and the Mantle network, although details have not yet been disclosed.