Franklin Templeton's BENJI, a blockchain-based money market fund, received SEC no-action relief to integrate with traditional finance infrastructure, demonstrating tokenization moving into legacy financial products rather than competing with them.
Regulation & Gov ·
Franklin Templeton received SEC no-action relief on August 12 permitting its traditional money market funds to use BENJI, a blockchain-based version investing in U.S. government securities, for cash management under specific conditions. The letter does not constitute SEC approval of BENJI itself, but represents a meaningful regulatory step enabling integration of tokenized infrastructure into legacy financial products rather than competing with them.
BENJI employs a hybrid architecture where a public blockchain records transactions and ownership, while a traditional transfer agent maintains the official ownership ledger and controls private keys. The structure enables peer-to-peer share transfers, intraday income generation, and near-instant settlement on a 24/7 basis. Beyond serving as a standalone investment, BENJI has expanded into collateral use—a February partnership with Binance allowed institutional clients to deploy tokenized shares as off-exchange collateral for trading, and a June integration with MoonPay connected the asset to stablecoin liquidity channels.
The regulatory path forward remains unresolved for other asset managers. The no-action letter applies specifically to Franklin Templeton's structure, and other firms seeking similar arrangements may require separate regulatory assessment rather than relying on this precedent. Whether the model signals broader acceptance of tokenized assets within traditional finance infrastructure, or remains limited to Franklin Templeton's circumstances, remains to be seen.