TL;DR
- Franklin Templeton launches its tokenized money market fund, FOBXX, on Coinbase’s Base blockchain, becoming the first asset manager to do so.
- The fund, which has a market cap of $410 million, is now available on five additional blockchains: Stellar, Aptos, Avalanche, Arbitrum and Polygon.
- With a focus on stability and liquidity, FOBXX seeks to deliver consistent income while preserving shareholder capital.
Franklin OnChain US Government Money Fund (FOBXX) has taken a major step forward by becoming available on Base, Coinbase’s layer 2 blockchain.
This action marks a milestone in the financial industry, as Franklin Templeton becomes the first asset manager to launch its fund on this platform.
This move not only reinforces Coinbase’s role in the evolution of the cryptocurrency ecosystem, but also signals a significant shift toward the digitization of traditional assets.
FOBXX, which has a market cap of $410 million, is designed to invest at least 99.5% of its assets in U.S. government securities, cash, and collateralized repurchase agreements.
The fund’s strategy focuses on providing a high level of current income while seeking to preserve shareholder capital and maintain a stable share price of $1 per share.
This approach is key to attracting investors seeking stability in a financial environment that can be volatile.
With this addition to Base, FOBXX is now available on six blockchains, including Arbitrum, Polygon, Avalanche, Aptos, and Stellar, which remains its main public network.
The adoption of blockchain technologies by financial institutions is a clear indicator of how the sector is recognizing the advantages of operating in digital environments.
The Base blockchain, which launched in 2022, has seen remarkable growth, handling over 55% more transactions in Q3 compared to Q2, reflecting its growing popularity.
The evolution of tokenized funds
The creation of FOBXX on a blockchain platform not only represents a technological advancement, but could also redefine the way assets are managed.
This fund becomes the second largest tokenized fund on the market and has pioneered the use of blockchain technology to record transactions and asset ownership.
With over $8 billion in total value locked (TVL), Base has quickly established itself as one of the leading Layer 2 blockchains, surpassing established competitors in the space.
The trend towards tokenization of funds and assets indicates that the financial sector is at a turning point.
Institutions like Franklin Templeton are embracing blockchain technology to improve efficiency and reduce costs, giving investors the opportunity to access more innovative and accessible investment products.
Not only does this open new doors for asset managers, it also democratises access to investments previously limited to a select group of investors.
As interest in digitalization and tokenization continues to grow, the future of the financial sector appears to be increasingly intertwined with blockchain technology.
Initiatives like Franklin Templeton’s at Base are just the beginning of what could be a profound transformation in how financial assets are managed and operated in an increasingly digitalized world.