Franklin Templeton Launches Tokenized US Dollar Money Market Fund in Hong Kong

Franklin Templeton Expands Crypto Offerings in Asia

Franklin Templeton, a leading global asset manager, has announced the launch of a tokenized US dollar money market fund for professional investors in Hong Kong. The fund, known as the Franklin OnChain U.S. Government Money Fund, is an end-to-end tokenized structure integrating issuance, distribution, and servicing directly on the blockchain in Hong Kong.

Initially, the tokenized fund will be available only to institutional and professional investors. It is registered in Luxembourg under a regulated framework that allows investment funds to be sold across the European Union. The fund utilizes Franklin Templeton’s proprietary blockchain recordkeeping system, aiming to provide income and preserve capital through investments in short-term US government treasuries.

Hong Kong Becoming a Trusted Hub for Digital Assets

While access remains limited at launch, Tariq Ahmad, Franklin Templeton’s head of Asia-Pacific, stated that the company plans to offer “a retail-approved tokenized fund, subject to SFC approval.” Brian Chen, head of OSL Wealth Management, is supporting the launch as a regulated distribution partner, noting that “Hong Kong is becoming an institutionally trusted hub for digital assets.”

This move by Franklin Templeton follows China Asset Management (Hong Kong)’s launch of its first tokenized product, the ChinaAMC HKD Digital Money Market Fund, announced in February. This underscores the growing interest in tokenized assets within the region.

Hong Kong Advances Asset Tokenization

In contrast to mainland China, Hong Kong operates under a well-defined regulatory framework for digital assets. This has enabled the city to emerge as a regional hub for cryptocurrency innovation and real-world asset (RWA) tokenization initiatives. In August, the Hong Kong Monetary Authority (HKMA) unveiled the Project Ensemble sandbox to explore how real-world assets can be tokenized and settled between banks using a wholesale central bank digital currency (wCBDC).

Project Ensemble builds upon previous initiatives, including the development of a wCBDC, launched in March 2024, to support asset tokenization. Further demonstrating Hong Kong's commitment, in September, UBS, Chainlink, and DigiFT launched a pilot program in Hong Kong to test automated fund tokenization using blockchain infrastructure for on-chain settlement and lifecycle management.

Adding to this momentum, in November, the HKMA outlined its RWA tokenization plans under its five-year Fintech 2030 strategy. These plans include issuing tokenized government bonds and exploring tokenized Exchange Fund papers, alongside the rollout of its e-HKD stablecoin. The city is actively shaping the future of finance with these innovative projects.