Binance teams with $1.6-trillion asset manager Franklin Templeton on tokenization push

Binance, the world's largest cryptocurrency exchange, said Wednesday it is partnering with Franklin Templeton to develop tokenized asset products that combine blockchain technology with legacy markets.

The tie-up intends to move tokenization "from concept to practice" by pairing the $1.6 trillion asset manager’s experience bringing securities onchain with the exchange's global trading infrastructure and distribution.

Bringing faster settlement, improved yield, and better liquidity channels to more investors are major goals for the partnership, said Sandy Kaul, Franklin Templeton's EVP and head of innovation. Binance brings transaction volume and a large user base, factors that, if successfully paired with compliant issuance, could make secondary trading and distribution of tokenized funds and other securities more practical at scale.

The crypto exchange cast the collaboration as part of a longer-running effort to connect centralized venues with decentralized markets for both retail and institutions. Terms weren’t disclosed, and the firms said specific products and launch timing will come later this year, subject to jurisdictional limits.

Franklin Templeton has been among Wall Street’s earliest tokenization adopters, launching its U.S.-regulated money market fund BENJI on Stellar in 2021. The product has since expanded to Ethereum, Solana, and other networks.

According to The Block’s data dashboard, it’s one of the largest government securities funds in decentralized finance.

A larger tokenization race is also in play in Washington. U.S. stock exchange Nasdaq filed a rule-changing proposal with the Securities and Exchange Commission to allow it to trade tokenized securities alongside traditional stocks. Policymakers are also working on a crypto market structure framework that includes guidance for treating assets on blockchains and DeFi.