SEC Nods to Franklin Templeton's Tokenized Assets Push
Franklin Templeton is pushing into tokenized assets with plans to integrate blockchain-based funds into traditional investment products. This move comes after receiving a 'no-action' letter from the SEC, allowing the asset manager to hold tokenized money-market funds as collateral or part of its portfolio.
The company's Sandy Kaul, Head of Digital Assets and Innovation, explained that this integration will provide more efficient management and yield capture for their funds. With over 130 ETFs managing approximately $82 billion in assets worldwide, Franklin Templeton is looking to transform the ETF market by improving capital efficiency, liquidity, and collateral management.
The SEC's nod has significant implications for the distribution channel, enabling investors to indirectly deal with ETFs through a direct connection to the blockchain platform. This development comes as the current ETF market has shown signs of recovery from outflows but still faces concerns about future inflows giving way to outflows.