Franklin Templeton updates pair of money market funds to be blockchain-ready

Franklin Templeton has updated two of its institutional money market funds to make them usable in the emerging tokenized finance and regulated stablecoin markets.

The changes apply to funds managed by its affiliate Western Asset Management and are aimed at letting institutional clients deploy familiar cash vehicles across blockchain-enabled platforms and stablecoin reserve frameworks.

One of the funds, the Western Asset Institutional Treasury Obligations Fund, was adjusted to meet reserve requirements under the U.S. GENIUS Act, signed into law last July, which sets standards for what assets can be used to back regulated stablecoins.

The fund now holds only U.S. Treasuries with maturities of 93 days or less, making it eligible for use as stablecoin reserves.

The second fund, the Western Asset Institutional Treasury Reserves Fund, introduced a new digital institutional share class that allows approved intermediaries to record and transfer fund ownership using blockchain infrastructure.

The fund itself remains a conventional money market fund, but the updated distribution rails are intended to enable faster settlement, integration with digital collateral and cash-management systems, and round-the-clock transfers and settlement.

Franklin Templeton said the updates are meant to help institutional investors adopt onchain infrastructure using products they already know, rather than launching new crypto-native funds

The updates follow moves by other big-name firms such as JPMorgan, which launched a tokenized money-market fund on Ethereum last month.