With the introduction of its OnChain U.S. Government Money Market Fund (FOBXX) on Coinbase’s layer-2 blockchain, Base, Franklin Templeton has made a major advancement in blockchain-based finance. With this launch, an asset manager has made a tokenized money fund available on Base for the first time, increasing the availability of conventional financial assets via blockchain technology.
The tokenized money market fund created by Franklin Templeton, FOBXX, was first introduced on blockchain networks like Stellar, Polygon, and Arbitrum. The fund now enjoys faster transactions and lower expenses because to its move to Base, which improves investor efficiency. The $435 million fund currently holds highly liquid assets, such as commercial paper and U.S. Treasury bills, to create low-risk returns.
Among asset managers, Franklin Templeton is uncommon in that it uses blockchain ledgers to record official transactions, a function that is typically performed offchain. The fund can now transparently maintain ownership records over a distributed public ledger thanks to its integration with blockchain, which reflects the growing trend of adopting blockchain to expedite financial procedures.
In addition to broadening Franklin Templeton’s selection of digital assets, the introduction of FOBXX on Base is a response to regulators’ increasing embrace of blockchain technology. The choice to conduct financial transactions using Base’s ledger shows how mature the technology is as a useful instrument in the financial industry. As more financial products start using blockchain for asset management and trading, this approach also fits with the larger trend of tokenizing real-world assets (RWAs), a market that is expected to grow to trillions of dollars globally.
With an estimated $8 billion in total value locked, Base has rapidly become a well-liked layer-2 scaling solution on Ethereum since its launch, ranking second only to Arbitrum. Franklin Templeton hopes to increase the fund’s visibility and attractiveness to the rapidly expanding cryptocurrency market by making FOBXX accessible on Base. This could open the door for other institutions to embrace tokenized financial products.
