Franklin Templeton has been granted a no-action letter by the Securities and Exchange Commission (SEC), allowing its new tokenized money-market fund to invest cash without adhering to physical custody regulations. The SEC will not pursue enforcement action if Franklin Templeton’s funds start investing cash in their own blockchain-based money-market fund.
The Franklin OnChain U.S. Government Money Fund is a tokenized interest-bearing fund that invests in US government securities, aiming to maintain a stable $1 share price. It represents approximately $2.5 billion in on-chain assets overseen by Franklin Templeton through its tokenized funds, which ranks as the fifth-largest tokenized asset manager according to RWA.xyz.
The SEC has outlined 12 conditions for Franklin Templeton’s compliance with these new regulations, ensuring a balanced approach that supports innovation while maintaining regulatory oversight.
Written by Steven Cook
Regulation Desk
