Franklin Templeton has expanded its tokenized money market infrastructure to Bybit, allowing eligible institutional clients to use Benji-issued fund shares as off-exchange collateral while accessing USDT or USDC trading credit lines.
Summary
- Franklin Templeton lets eligible Bybit clients pledge Benji fund shares while assets remain off-exchange securely.
- Benji collateral can support USDT or USDC trading credit lines through ByCustody for eligible institutions.
- Franklin OnChain U.S. Government Money Fund held $686.64 million in net assets on August 31.
- Bybit and Franklin Templeton plan a wallet-based tokenized wealth product using the Mantle blockchain network.
- Franklin previously launched comparable off-exchange Benji collateral arrangements with Binance and other crypto platforms globally.
Franklin Templeton announced the collaboration with Bybit on Sept. 28, with the first program connecting its Benji Technology Platform to ByCustody and Bybit’s trading infrastructure.
The underlying tokenized assets remain outside the exchange in custody while their value is mirrored into the client’s Bybit trading environment. Eligible investors can continue receiving fund yield while using the collateral value to support trading activity.
Franklin OnChain U.S. Government Money Fund, or FOBXX, held $686.64 million in net assets as of Aug. 31, Franklin Templeton reports. One share of the fund is represented by one BENJI token on Franklin Templeton’s blockchain-integrated recordkeeping platform.
Franklin Templeton gives Benji shares a Bybit collateral role
Under the new arrangement, eligible institutional clients can pledge Benji-issued money market fund shares through ByCustody. The custody platform holds the assets off-exchange, while Bybit recognizes their mirrored value when providing USDT or USDC trading credit.
ByCustody describes its off-exchange setup as a model where assets remain in custody while a mirror-mapping layer supports trading access. Its current institutional collateral matrix already includes tokenized real-world assets alongside crypto collateral.
The Franklin fund itself invests primarily in U.S. government securities, cash and repurchase agreements. Its latest published seven-day current yield was 3.57% as of Sept. 16, while its seven-day effective yield stood at 3.63%, according to Franklin Templeton’s fund page.
Yoyee Wang, Bybit’s global head of RWA and TradFi, said institutional investors increasingly expect flexibility and risk controls similar to those used in traditional markets. Wang said the expanded collateral options are intended to let clients deploy capital while retaining exposure to regulated investment products.
Bybit clients can keep tokenized assets off-exchange
The structure separates custody from trading access. Clients do not have to transfer the underlying Benji fund shares onto Bybit before using their value in trading activities.
A similar structure is already operating elsewhere in the market. Franklin Templeton and Binance launched an institutional program in February that lets eligible clients use Benji-issued tokenized money market fund shares as off-exchange collateral while the assets stay with regulated custody infrastructure. Franklin Templeton announced that Binance arrangement on Feb. 11.
The Franklin Templeton and Binance off-exchange collateral program uses the same basic model of keeping yield-bearing fund shares away from the exchange while recognizing their collateral value for trading.
Bybit has already tested comparable infrastructure with other tokenized funds. In June, quantitative fund Calais Digital Assets used UBS’s tokenized uMINT money market fund as off-exchange collateral through Bybit, ByCustody and DigiFT.
Bybit’s current custody product page lists tokenized RWA collateral among its supported institutional products, alongside spot trading, futures, options and lending services.
Benji access has expanded across crypto platforms
Franklin Templeton has spent 2026 extending Benji into several institutional crypto workflows. In June, Franklin Templeton partnered with MoonPay to connect the Benji Technology Platform with MoonPay Trade. Eligible institutional users can move between supported stablecoins and tokenized money market fund exposure through the platform.
The Benji integration with MoonPay Trade introduced another route for institutions to use tokenized money market exposure within on-chain treasury, liquidity and portfolio-management workflows.
Franklin Templeton has worked with Kraken parent Payward as well. The Franklin Templeton and Payward tokenization partnership covers the use of Benji for collateral and cash management while extending into tokenized investment products.
Regulatory access has expanded during the same period. In August, the U.S. Securities and Exchange Commission’s Division of Investment Management issued no-action relief allowing Franklin Templeton registered mutual funds and ETFs to hold shares of the blockchain-based fund under the described custody structure.
The SEC clearance for Franklin funds to use BENJI opened another potential use case for the tokenized fund inside conventional registered investment products.
Franklin Templeton and Bybit plan a wallet product on Mantle
The Bybit agreement extends beyond institutional collateral. Franklin Templeton and Bybit said they plan to introduce a tokenized wealth product for wallet-based investors through Bybit and the Mantle blockchain.
The companies have not provided a launch date, product composition, eligibility rules or jurisdictional availability. Further details are expected to be released separately by Bybit and Mantle.
Franklin Templeton’s Sandy Kaul said tokenization is changing how investment products connect with digital markets, adding that Benji connectivity can give institutions another venue for using regulated, yield-bearing assets.
Franklin Templeton has already moved several traditional investment products toward wallet-based distribution. Its tokenized U.S. government fund expansion through HashKey extended access to professional investors in several markets, while its Benji platform now operates across multiple public blockchain networks.
Franklin Templeton’s latest corporate filing reported $1.83 trillion in total assets under management as of Aug. 31, up from $1.79 trillion at the end of July. The company’s cash-management assets totaled $85 billion at month-end.
The asset manager has not given a timetable for the Bybit-Mantle wallet product, saying Bybit and Mantle will release further information separately.
