Key Takeaways
- Asset managers are increasingly adfopting a multi-chain approach to tokenization.
- Franklin Templeton’s money market fund, FOBXX, is now deployed on nine separate blockchain platforms.
- New tools are emerging to manage multichain tokenized asset portfolios.
Rather than deploying tokenized funds on just one or two blockchains, asset managers are increasingly embracing a multi-chain model.
In the latest instance of the trend, Franklin Templeton has launched its U.S. Government Money Fund (FOBXX) on VeChain. BENJI tokens, which represent shares in the tokenized fund, can now be issued on nine separate blockchain platforms.
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BENJI Launched on 9th Blockchain
FOBXX and the BENJI token were first launched on the Stellar blockchain in 2021 as the first ever U.S.‑registered mutual fund to process transactions and record ownership on a public blockchain.
Starting in 2022, Franklin Templeton embarked on a multichain push that now includes both Ethereum Layer 2s and sovereign Layer 1 blockchains.
Home to around 55% of BENJI tokens, Stellar remains central to FOBXX issuance and redemption. However, Ethereum and Arbitrum have also become increasingly prominent within Franklin Templeton’s ecosystem, hosting tokens worth tens of millions each.
The latest addition to the roster, VeChain, brings an emphasis on sustainability and a suite of tools built specifically for institutional use cases.
Franklin Templeton is the first major asset manager to adopt VeChain for tokenization, but the VeChain Foundation sees fund managers as an important market for its platform, Managing Director for Institutional Growth Johnny Garcia told CCN.
Cross-Chain Tokenization
Moving a step beyond multi-chain tokens, some asset managers have started to explore cross-chain functionality.
For instance, Hamilton Lane recently partnered with Wormhole to let investors move shares in its Senior Credit Opportunities (SCOPE) fund between Optimism and the Ethereum base layer.
Cross-chain interoperability promises to increase liquidity, preventing assets from becoming siloed in different blockchain ecosystems.
“By enabling the transfer of SCOPE across blockchain networks, Wormhole allows Hamilton Lane to meet capital where it lives,” said Wormhole Foundation Co-Founder Robinson Burkey.
Interoperability start with cross-chain messaging, and Wormhole isn’t the only protocol being leveraged by financial institutions to break down barriers between blockchains.
Major banks, asset managers, and infrastructure providers are also exploring alternatives like Chainlink and LayerZero. But with so many moving parts, cross-chain tokenization introduces additional complexity for investors.
Managing Multichain Portfolios
With tokenized funds increasingly issued on a diverse array of blockchains, investors and wealth managers require new tools to manage complex multichain portfolios.
To that end, JPMorgan’s “Project Guardian” has developed a proof of concept for a portfolio management solution for multi-chain tokenized assets.
The system developed by the bank is able to automatically rebalance investor portfolios, replacing one asset for another, even when funds are deployed on different chains.
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James Morales is CCN’s blockchain and crypto policy reporter. He has been working in the news media since 2020, writing about topics such as payments, banking and financial technology. These days, he likes to explore the latest blockchain innovations and the evolving landscape of global crypto regulation.
With an educational background in social anthropology and media studies, James uses his platform as a journalist to explore how new technologies work, why they matter and how they might shape our future.
