Franklin Templeton has introduced an institutional off-exchange collateral program in collaboration with Binance, allowing clients to use tokenized money market fund (MMF) shares to support digital asset trading. The structure enables institutions to pledge tokenized MMF shares issued through Franklin Templeton’s Benji Technology Platform while keeping the underlying assets in regulated custody.
Instead of transferring assets directly onto the exchange, the tokenized fund shares are held off-exchange by Ceffu Custody, a Dubai-regulated digital asset custodian. Their collateral value is mirrored within Binance’s trading system, enabling institutions to maintain trading positions without relinquishing control of their assets. The model is designed to reduce counterparty risk and improve capital efficiency.
Institutional Crypto Trading and Yield-Bearing Collateral
By using tokenized MMFs as collateral, institutions can continue earning yield on low-volatility, regulated fund holdings while simultaneously deploying them to support crypto trading strategies. This approach offers an alternative to posting idle stablecoins or more volatile tokens as margin.
The initiative reflects a broader market shift toward tokenized real-world assets serving as onchain collateral. As adoption grows, regulators have highlighted the importance of cross-border oversight to address potential regulatory gaps and ensure investor protection in evolving tokenization frameworks.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.