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SEC issues no-action letter for Franklin Templeton onchain money fund
The SEC said it will not pursue enforcement if Franklin Templeton funds invest cash in the Franklin OnChain U.S. Government Money Fund, which targets a stable $1 share price.
The U.S. Securities and Exchange Commission issued a no-action letter indicating it will not pursue enforcement action if Franklin Templeton fund managers begin investing cash in the firm’s own tokenized money market fund, the Franklin OnChain U.S. Government Money Fund, according to Cointelegraph. The tokenized fund is designed as an interest-bearing product that invests in U.S. government securities and aims to maintain a stable $1 share price, the outlet reported. Cointelegraph added that the SEC’s allowance also extends to Franklin Templeton Investor Services, the affiliated transfer agent, to operate as custodian and hold private keys for the tokenized funds. The SEC tied its position to specific guardrails, including maintaining systems that prevent unauthorized instructions. Cointelegraph reported that the SEC also required administrative controls for FTIS, such as the ability to correct, freeze, migrate or restore records. Cointelegraph said the decision followed Franklin Templeton’s no-action request sent earlier on Wednesday and that the firm oversees $2.5 billion in onchain assets through its tokenized funds. The outlet also noted Franklin Templeton launched a dedicated crypto division and acquired crypto asset manager 250 Digital in June as part of its tokenization push.