Global asset manager Franklin Templeton’s blockchain-based money market fund has launched within the Arbitrum ecosystem, as tokenized real-world asset (RWA) funds gain traction among investors. Arbitrum is a popular scaling solution for Ethereum.
Franklin Templeton’s Nasdaq-listed U.S. government-backed OnChain monetary fund, FOBXX, is now available on digital wallets on the Arbitrum network on Thursday, the company said in a statement. The launch of FOBXX on Arbitrum is part of its issuer’s efforts to broaden access to the fund among retail investors, with a focus on deploying the fund on highly secure and active networks.
“The cost of using the network (and) the resiliency and scalability of the network are all… factors that we consider when we build (FOBXX’s) wallet infrastructure across various blockchain ecosystems,” said Roger Bayston, Franklin Templeton’s head of digital assets. Decrypt on Thursday.
“Our goal is to listen to the consumer and the customer and give them what they want,” he added.
FOBXX’s expanding access to investors comes at a time when demand for tokenized real asset funds is booming. The largest such fund, BlackRock’s BUIDL fund, has paid out $7 million in dividends since its launch in March. The tokenized Treasury bond market more than doubled to $1.8 billion from January to June 2024, according to to a Dune dashboard published by crypto firm 21 Shares.
FOBXX is a fund that invests “at least 99.5% of its total assets in U.S. government securities, cash and repurchase agreements fully guaranteed by the U.S. government,” according to its issuer’s website. It aims to provide relatively high returns to institutional and retail investors by investing in government securities and related instruments.
The fund had approximately $420 million in assets under management as of July 31, 2019. according to to its issuer’s data, making it the second largest offering on the market.
FOBXX debuted on the Stellar network in 2021, positioning itself as the first US-registered fund to use a public blockchain.Since then, it has also been available on Polygon, expanding its reach to investors.
The fund’s launch on Arbitrum comes about five months after Franklin Templeton filed to join the network’s Stable Treasury Endowment Program (STEP). Arbitrum has a market capitalization of about $1.8 billion.
However, the process leading to FOBXX’s debut required much more than just Arbitrum’s approval.
“What’s really important for us is to not only work with the network team, but also with our friends at the SEC to talk about why (launching the fund) improves outcomes for all stakeholders involved,” Bayston said.
Edited by Ryan Ozawa.
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