Franklin Templeton Brings Tokenized BENJI Into ETFs and Mutual Funds

Franklin Templeton has obtained a Securities and Exchange Commission no‑action position that permits the firm to incorporate its tokenized money‑market product, BENJI, into traditional exchange‑traded funds (ETFs) and mutual funds. The clearance marks the first time the SEC has explicitly allowed a digitally native asset to be used for cash management and collateral within conventional investment vehicles.

Regulatory clearance and timeline

The SEC’s no‑action letter clears the structure for using BENJI tokens as a holding or collateral asset. Franklin expects the integration to begin in the fourth quarter of 2026, pending approval from the boards of individual funds.

Potential scope within Franklin’s fund lineup

Franklin oversees more than 130 ETFs globally, managing roughly $82 billion, and mutual funds with about $790 billion in assets. The tokenized money‑market fund currently manages approximately $2.6 billion. If adopted, BENJI could be used across a substantial portion of these portfolios for liquidity management.

Broader industry context

Tokenized real‑world assets are gaining traction in traditional finance, with the overall market value exceeding $38 billion, according to RWA.xyz. Other major firms, including BlackRock and BNY Mellon, have also expanded blockchain‑based fund and settlement initiatives, citing faster settlement, 24/7 transfers, and more efficient collateral use.

Future tokenization plans

Franklin intends to develop additional tokenized products that could serve as cash or collateral across a wider range of its funds, moving tokenization from a peripheral wrapper to an integral component of portfolio management.