Franklin Templeton enters the market with blockchain-friendly money market funds

Asset management giant Franklin Templeton has reorganized two money market funds aimed at institutional investors to fit the blockchain-based financial ecosystem. This move is interpreted as a strategy to proactively respond to market demand for regulated reserve assets amid the rapid growth of stablecoins and tokenized assets.

Franklin Modernizes LUIXX and DIGXX Funds

The two funds managed by Franklin Templeton’s subsidiary, Western Asset Management, became the centerpiece. These are the Western Asset Institutional Treasury Obligations Fund (LUIXX) and the Western Asset Institutional Treasury Reserves Fund (DIGXX).

LUIXX has changed its structure to align with the GENIUS Act (Guiding and Establishing National Innovation for U.S. Stablecoins), a new U.S. government legislation related to stablecoins. The fund now only holds short-term U.S. Treasury bonds with maturities of less than 93 days, which is significant in that it can be used as a reserve basis for regulated stablecoins.

DIGXX Transitions to an On-Chain Trading Platform

Meanwhile, DIGXX has introduced a new class of digital institutional stocks designed with circulation in mind on blockchain-based platforms. This means that authorized brokers can record and transfer ownership of fund shares on-chain.

This structure provides several operational benefits. Above all, it will be possible to make faster payments by breaking away from the existing T+2 payment method. In addition, 24-hour trading will be activated, seven days a week, and integration with the digital asset ecosystem will be easier. The fund still maintains its registration with the U.S. Securities and Exchange Commission (SEC) and follows the existing money market operating rules.

The on-chain movement of traditional finance is an unstoppable trend

Roger Bason, head of digital assets at Franklin Templeton, said, “As traditional funds have already begun to move to the blockchain, we are focused on making these products more accessible and practical.” This is a statement that emphasizes the need for technological adaptation rather than technology rejection.

Franklin Templeton’s Accelerating Blockchain Expansion

Franklin Templeton has continued to expand his presence in the blockchain space in recent months. In November last year, it launched a tokenized money market fund in Hong Kong, and in the same month, it expanded its Benji technology platform to Canton Network.

This update to LUIXX and DIGXX suggests that stablecoins and regulated on-chain finance are securing real institutional demand. Franklin Templeton’s continuous moves are proof that the traditional asset management industry recognizes the need for a blockchain ecosystem and is actively responding.