Key Takeaways
- • Franklin Templeton, a 75-year-old asset manager, has pursued digital assets since 2018, launching the first U.S.-registered mutual fund on a public blockchain (Franklin OnChain U.S. Government Money Fund) in 2021 and expanding to Ethereum, Polkadot, Cardano and Solana in 2022.
- • The firm created a dedicated cryptocurrency division, Franklin Crypto, this year after acquiring crypto investment firm 250 Digital.
- • Robert Crossley, Franklin Templeton's global head of industry and digital advisory services, argues banks risk losing relevance if they rely on competition models "rendered out of date by technology."
- • The natively tokenized money market fund Benji pays interest daily, including weekends and holidays, because it mints a new token with no off-chain book of record, according to Crossley.
- • Crossley says the firm runs its money market funds across 10 public chains and sees chains specializing by use case, with Ethereum positioned as institutional-grade but high-cost and slower.
Summary
Franklin Templeton, the 75-year-old investment firm named after Benjamin Franklin for his emphasis on frugality and prudence, was a traditional Wall Street manager until 2018, when it began internal development and research into digital asset networks and blockchain infrastructure. In 2021 it launched the Franklin OnChain U.S. Government Money Fund, the first U.S.-registered mutual fund on a public blockchain. In 2022 it expanded to Ethereum, Polkadot, Cardano and Solana, launched a blockchain fund and introduced digital asset separately managed accounts. This year the firm created Franklin Crypto, a dedicated cryptocurrency division, following its acquisition of crypto investment firm 250 Digital.
In an interview, Crossley attributed the firm's pace to leadership. CEO Jenny Johnson, who previously served as president and chief operating officer and ran operations and technology, was described as having recognized that the financial industry rests on records of ownership and changes of ownership, which could be used to benefit clients. Crossley and digital assets head Sandy Kaul came to Franklin after their time at Citi, where Crossley said they advised leaders across the industry, and he cited Franklin's infrastructure and understanding of the technology's implications as a reason for joining.
The firm's central product argument centers on Benji, its natively tokenized money market fund. Crossley said the fund has no off-chain book of record to reconcile, which allows interest to be calculated and paid in real time. He said a traditional money market fund accrues interest daily but usually pays monthly, while Benji pays out daily, including weekends and holidays. He described this as a benefit to treasurers and as a means of improving fund cash management. Crossley also said Franklin's money market funds operate across 10 public chains and that the firm continuously evaluates which chains are suitable.
On competitive dynamics, Crossley argued that banks fear losing deposits to stablecoins and tokenized assets, and that losing control of cash means losing the client relationship. He characterized the industry as moving toward multiple competing forms of money, with users holding funds in the form best suited to each use. He said stablecoins currently function as operational balances for decentralized finance and that Benji serves as a bridge between regulated finance and blockchain-based finance. On market structure, Crossley said the DTCC's offering of tokenized stock on the private Canton network represents top-down tokenization, giving users a choice between traditional and blockchain rails, and that he expects chains to specialize rather than consolidate.
In an interview, Crossley attributed the firm's pace to leadership. CEO Jenny Johnson, who previously served as president and chief operating officer and ran operations and technology, was described as having recognized that the financial industry rests on records of ownership and changes of ownership, which could be used to benefit clients. Crossley and digital assets head Sandy Kaul came to Franklin after their time at Citi, where Crossley said they advised leaders across the industry, and he cited Franklin's infrastructure and understanding of the technology's implications as a reason for joining.
The firm's central product argument centers on Benji, its natively tokenized money market fund. Crossley said the fund has no off-chain book of record to reconcile, which allows interest to be calculated and paid in real time. He said a traditional money market fund accrues interest daily but usually pays monthly, while Benji pays out daily, including weekends and holidays. He described this as a benefit to treasurers and as a means of improving fund cash management. Crossley also said Franklin's money market funds operate across 10 public chains and that the firm continuously evaluates which chains are suitable.
On competitive dynamics, Crossley argued that banks fear losing deposits to stablecoins and tokenized assets, and that losing control of cash means losing the client relationship. He characterized the industry as moving toward multiple competing forms of money, with users holding funds in the form best suited to each use. He said stablecoins currently function as operational balances for decentralized finance and that Benji serves as a bridge between regulated finance and blockchain-based finance. On market structure, Crossley said the DTCC's offering of tokenized stock on the private Canton network represents top-down tokenization, giving users a choice between traditional and blockchain rails, and that he expects chains to specialize rather than consolidate.
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