Franklin Templeton and Binance Launch Tokenized Collateral Program for Institutions

Franklin Templeton and Binance have launched a new institutional off-exchange collateral program, allowing eligible clients to use tokenized money market fund shares as trading collateral.

The initiative enables institutions to deploy yield-bearing traditional assets in digital markets without transferring custody to an exchange.

How the Program Works

Under the new structure, tokenized money market fund shares are issued through Franklin Templeton’s Benji Technology Platform. Eligible institutional clients can pledge these tokenized shares as off-exchange collateral when trading on Binance.

Rather than transferring assets directly onto the exchange, the underlying fund shares remain securely held in third-party custody. Their value is mirrored inside Binance’s trading environment using infrastructure provided by Ceffu, Binance’s institutional custody partner. This setup allows institutions to maintain regulatory protections and custody safeguards while actively deploying capital in digital markets.

Improving Capital Efficiency

The program addresses a longstanding institutional challenge: the need to post collateral on exchanges while minimizing custody and counterparty risk. By allowing regulated, yield-bearing money market fund assets to serve as collateral, institutions can continue earning yield while supporting trading activity.

This structure reduces the trade-off between security and efficiency. Participants no longer need to park large pools of capital directly on an exchange to gain exposure, helping optimize liquidity management and operational risk frameworks.

TradFi and Digital Assets Move Closer

The launch builds on Franklin Templeton and Binance’s strategic collaboration announced in 2025. Both firms framed the initiative as part of a broader effort to bridge traditional financial infrastructure with blockchain-based markets.

Roger Bayston, Head of Digital Assets at Franklin Templeton, emphasized that the off-exchange collateral program allows clients to put assets to work while maintaining third-party custody protections. Catherine Chen, Head of VIP and Institutional at Binance, highlighted that integrating tokenized real-world assets into trading infrastructure represents a natural step toward merging traditional and digital finance.

Ceffu’s leadership also noted that institutions increasingly require trading models that prioritize strong risk management without sacrificing capital efficiency – especially in markets operating on a 24/7 settlement cycle.

A Broader Institutional Trend

Demand for stable, yield-bearing collateral continues to rise as institutions deepen participation in digital markets. Tokenized money market funds offer a familiar, regulated product structure adapted for blockchain-enabled trading environments.

By enabling traditional financial instruments to function within crypto trading infrastructure, the program signals continued maturation of digital asset markets. It also reinforces the growing role of tokenization in reshaping how capital is deployed, secured, and settled across global markets.

As institutional adoption accelerates, infrastructure solutions that combine regulatory alignment, custody safeguards, and operational efficiency are likely to define the next phase of digital finance integration.

The information provided in this article is for educational purposes only and does not constitute financial, investment, or trading advice. Coindoo.com does not endorse or recommend any specific investment strategy or cryptocurrency. Always conduct your own research and consult with a licensed financial advisor before making any investment decisions.

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