The financial organization focused on digital assets, Franklin Templeton, is expanding its tokenized collateral program, providing Bybit platform users the ability to use tokenized shares of their money market funds as collateral for credit lines using stablecoins USDT or USDC. The partnership will allow investors to secure loans using shares worth approximately $686 million while still earning income from the assets, according to a Monday press release. A key point is that users will not need to move their assets to the Bybit platform. Instead, the regulated custody platform ByCustody will hold the main assets off-exchange, mirroring their value in the Bybit trading environment, allowing for income generation while unlocking liquidity for trading.
This project is not Franklin Templeton's first experience in the field of off-exchange collateral; they previously offered their tokenized money funds to clients of companies like Binance and OKX. Sandy Kaul, head of digital assets and innovation at Franklin Templeton, noted that this creates an opportunity for investors to use their assets more efficiently, earning from them. "Now I can really look at the main exchanges and, as an investor, use my collateral more optimally, earning income from it," she said in an interview.
The tokenized shares were issued through the Benji Technology platform, Franklin Templeton's proprietary infrastructure for record-keeping and transfer management, integrated with blockchain. Currently, Benji offers an annual yield of 3.7%, based on the latest seven-day data. The expansion of the program reflects a broader trend in the industry: several crypto platforms are accepting tokenized funds as collateral for transactions. For example, Crypto.com and Deribit allow eligible professional users to use BlackRock's BUIDL fund to support trading operations, including derivative positions. With stablecoins increasingly entering the regulated financial environment, APAC (Asia-Pacific region) is becoming an important testing ground for these initiatives.
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