Franklin Templeton Asset Management has partnered with Ondo Finance to issue tokenized versions of five ETF funds tracking stocks, bonds, and gold, targeting crypto-native investors who use digital wallets instead of traditional brokers.
These funds will operate entirely on-chain, allowing 24/7 trading and integration into the DeFi ecosystem. Ondo will provide liquidity and hold the underlying ETF shares as collateral for the issued tokens.
The tokenized portfolios include: U.S. growth stock fund, large-cap stock fund, gold fund, high-yield corporate bond fund, and income-generating stock strategy. The issuance structure uses a special purpose vehicle (SPV), where Ondo purchases and safekeeps the underlying assets before issuing the corresponding tokens.
The tokenized assets include: U.S. growth stock fund, large-cap stock fund, gold fund, high-yield corporate bond fund, and income-generating stock strategy. The issuance structure uses a dedicated legal entity (SPV), in which Ondo acquires and holds the underlying assets before issuing the tokens.
Franklin Templeton is considered a pioneer in tokenization since 2021 with its OnChain U.S. Government Money Fund (BENJI) — currently the fourth-largest on-chain government bond product, managing over $1 billion in assets.
This new move marks a significant expansion into tokenization, amid many major financial institutions accelerating strategies to bring real-world assets (RWA) onto the blockchain.
Initially, the tokenized ETFs will be launched in Europe, Asia-Pacific, the Middle East, and Latin America. Meanwhile, the U.S. Securities and Exchange Commission continues to affirm that on-chain securities assets remain within the scope of existing securities laws.
Currently, Franklin Templeton manages approximately $1.7 trillion in assets, while Ondo Finance reports around $620 million in total value locked (TVL).
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