Franklin Templeton integrates blockchain for fund verification

Franklin Templeton has integrated a new verification system for two of its tokenised funds, the Franklin Bitcoin ETF (EZBC) and the Franklin OnChain US Government Money Fund (FOBXX), using Jiritsu’s network on Avalanche.

This new system enables asset managers to issue retail-friendly tokens backed by these funds, expanding accessibility to retail investors.

The FOBXX fund has been available on multiple blockchain networks since 2021, represented by the BENJI token, but retail investors have not been able to directly trade the fund using a standard Web3 wallet.

Jiritsu co-founder Jacob Guedalia explained that the new system eliminates this barrier.

The verification mechanism ensures that only properly backed tokens are minted.

“If you’re an asset manager and you’re holding BENJI and I buy a token that represents a fractional ownership of your portfolio of [those] BENJI tokens, what it does is it verifies that the money is there [...] And we have a control mechanism, a policy mechanism, that says ‘you cannot mint that token unless you’ve got something to back it up,’” he stated.

The system operates using Jiritsu’s multiparty computation (MPC) network to enforce this policy.

Guendalia expects that retail tokens backed by these funds will be available by the end of the year.

However, investors will need to complete a KYC verification through a web portal to access the tokens.

These tokens will also be compatible with decentralised finance (DeFi) applications in the long term, reducing friction for investors by allowing them to hold blockchain-backed shares of funds directly.

In addition to Franklin Templeton’s tokenised funds, other investment products, including BlackRock’s BUIDL money market fund and ONDO’s USDY (CRYPTO:USDY) token, are also being tokenised for blockchain networks.