The US-based investment management company Franklin Templeton, which has over $1.5 trillion in assets under management, has introduced the OnChain U.S. Government Money Market Fund on Arbitrum. This is the third blockchain platform in which the fund has invested. It is currently available on Stellar and Polygon and seeks to extend the use of blockchain technology in the conventional financial sector.
Arbitrum, a layer-2 solution for Ethereum, has opened up trading of the fund’s shares for investors. Earlier, these shares were listed on Stellar and Polygon blockchains. The company initially plans to focus this expansion on institutional wallets. With such strategic moves, Franklin Templeton seeks to facilitate the harmonization between the decentralized and the conventional financial systems.
Roger Bayston, the head of digital assets at Franklin Templeton, highlighted that it is a strategic move.
He said,
“Incorporating Arbitrum into the ecosystem improves our asset management with innovative blockchain technologies.”
This integration will help the fund to attract more investors. Bayston’s leadership involves using technology to transform the current asset management paradigms.
Launched in 2021, the fund has a market capitalization of $420 million. It is the third largest U.S. Treasury-linked on-chain product. Adopting a public blockchain to record transactions was unique in the industry. This aligns with the ongoing trend of tokenizing various real-world assets (RWAs).
Big names like BlackRock, Securitize, and Ondo Finance have also entered the blockchain-based funds market. BlackRock’s BUIDL, operating on the Ethereum main chain, tops the list with the highest market capitalization among such funds. These developments indicate a shift towards integrating blockchain technology into conventional financial activities.
The increased adoption of blockchain by big firms in the industry indicates that the technology has the potential to revolutionise the asset management industry. Franklin Templeton’s entry into Arbitrum will boost its operational effectiveness and attract new investments.