Singapore’s largest bank, DBS, has announced a tie up with asset manager Franklin Templeton and Ripple for tokenized money market funds (MMF). The bank plans to offer Franklin Templeton’s tokenized money market fund to its accredited and institutional investors via its DBS Digital Exchange (DDEx).
The issuance of the sgBENJI token is on the XRP Ledger, expanding Franklin Templeton’s supported blockchains. BENJI is the token for the Franklin Onchain U.S. Dollar Short-Term Money Market Fund. Investors will be able to switch between cryptocurrencies on the DDEx into Ripple’s RLUSD stablecoin and from there into the sgBENJI token. This can be particularly useful during periods of crypto price volatility. The ability to trade the token 24/7 and settle instantly, compares with traditional money market funds which have windows for redemption and can incur settlement delays.
Beyond immediate trading benefits, DBS sees broader applications for the token. DBS also plans to use the sgBENJI token as collateral. This might involve repo transactions where users wish to borrow cash from the bank. It may also enable the sgBENJI tokens held in custody by DBS to be used as collateral on third party platforms.
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