TLDR
- Franklin Templeton partnered with Bybit to let institutional clients use Benji-issued fund shares as off-exchange trading collateral.
- Clients can access USDT or USDC credit lines through ByCustody without selling their fund shares.
- The Franklin OnChain U.S. Government Money Fund held $686.64 million in net assets as of August 31.
- Franklin Templeton and Bybit plan a wallet-based tokenized product using the Mantle blockchain network.
- Franklin Templeton reported $1.83 trillion in total assets under management as of August 31.
Franklin Templeton has expanded its tokenized fund business to Bybit. The deal lets eligible institutional clients use fund shares as trading collateral.
Building with @Bybit_Ins.
Bybit and Franklin Templeton Form Strategic Collaboration to Expand Access to Tokenized Investing
The wider collaboration launches with a new off-exchange collateral program that unlocks trading liquidity for institutional clients, alongside… pic.twitter.com/tjgglM0YwQ
— Franklin Templeton Digital Assets (@FTDA_US) September 28, 2026
The companies announced the partnership on September 28. It connects Franklin Templeton’s Benji Technology Platform to Bybit’s custody arm, ByCustody.
Under the setup, clients can pledge Benji issued money market fund shares. The shares stay in custody, off the exchange, while their value backs trading credit.
Eligible clients can then draw credit lines in USDT or USDC. This lets them trade on Bybit without selling their fund shares.
The structure means clients keep earning yield on the fund shares. At the same time, they gain access to stablecoin trading credit.
How the collateral system works
ByCustody holds the underlying assets away from the exchange. A mirror system tracks the value of those assets and applies it toward trading limits.
Bybit already accepts other tokenized real world assets as collateral. In June, a quantitative fund used UBS’s tokenized money market fund through Bybit and ByCustody.
Yoyee Wang, Bybit’s global head of RWA and TradFi, said institutional investors want flexibility and risk controls similar to traditional markets. She said the new option lets clients use regulated products while deploying capital.
The Franklin OnChain U.S. Government Money Fund backs this arrangement. It invests mainly in U.S. government securities, cash and repurchase agreements.
The fund held $686.64 million in net assets as of August 31. Its seven day yield was 3.57 percent as of September 16.
Franklin Templeton’s wider crypto push
This is not Franklin Templeton’s first tokenized collateral deal. It launched a similar program with Binance in February, using the same off-exchange model.
Franklin Templeton also linked Benji to MoonPay Trade in June. That deal let institutions move between stablecoins and tokenized fund exposure.
The firm has worked with Kraken parent Payward too. That partnership covers collateral use and cash management with Benji.
In August, the Securities and Exchange Commission’s Division of Investment Management issued no action relief. This lets Franklin Templeton mutual funds and exchange traded funds hold shares of the blockchain based fund.
Franklin Templeton and Bybit also plan a wallet based product built on the Mantle blockchain. The companies have not shared a launch date or eligibility details.
Franklin Templeton reported $1.83 trillion in total assets under management as of August 31. That is up from $1.79 trillion at the end of July.
Its cash management assets totaled $85 billion at month end. The Benji platform’s assets under management stood near $669 million, according to RWA.xyz data.
Demand for tokenized money market funds has grown. The Bank for International Settlements valued the market at more than $9 billion as of September 2025.
BlackRock’s USD Institutional Digital Liquidity Fund is the largest tokenized money market fund at $2.2 billion. It is accepted as collateral on Crypto.com and Deribit, and Binance allows institutional clients to use it as off-exchange collateral as well.
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