Franklin Templeton Expands Tokenized Collateral Service to Bybit
Franklin Templeton is expanding its tokenized money market fund infrastructure to Bybit, giving eligible institutional clients a new way to access crypto trading liquidity without moving their yield-bearing assets onto the exchange. The partnership announced Sept. 28 adds another connection between traditional asset management and digital-asset markets.
The program allows eligible investors to pledge Franklin Templeton fund shares issued through its Benji Technology Platform as off-exchange collateral. Clients can then access USDT or USDC trading credit lines on Bybit while continuing to earn income from the underlying assets.
Tokenized Assets Meet Crypto Liquidity
The collateral remains in custody through ByCustody rather than being transferred directly to Bybit. The value of the tokenized holdings is mirrored within Bybit’s trading environment, allowing the assets to support trading activity while remaining outside the exchange.
The structure offers several potential benefits for institutional users:
- Access to USDT or USDC trading credit
- Continued yield on eligible underlying assets
- Off-exchange custody of the collateral
- Greater flexibility for institutional treasury management
Franklin Templeton has previously positioned tokenized money market funds as instruments that can combine traditional money-market exposure with blockchain-based settlement and collateral functionality.
A Broader Push Into Tokenized Finance
The Bybit arrangement builds on Franklin Templeton’s broader expansion of tokenized collateral services across digital-asset venues. The asset manager has also pursued similar structures with other major crypto exchanges.
Bybit has been developing its own institutional collateral infrastructure. Its Bank Triparty service, launched in July, allows eligible institutions to use U.S. dollars or Treasury bills held with regulated banking partners to obtain USDT financing while retaining exposure to the collateral.
The latest partnership reflects a wider shift toward using tokenized real-world assets as productive collateral. Rather than selling or leaving traditional investment assets idle, institutions can potentially use them to support trading liquidity while maintaining their underlying economic exposure.
Franklin Templeton and Bybit said the collaboration will also extend into tokenized wealth products and educational initiatives for wallet-based investors, signaling a broader effort to connect regulated investment products with blockchain-based financial markets.
