Franklin Templeton brings tokenized collateral to Bybit traders
Franklin Templeton is extending its tokenized collateral service to Bybit, allowing institutional traders to use BENJI tokens as off-exchange collateral. The tokens represent shares in the Franklin OnChain U.S. Government Money Fund and remain with a regulated custodian while earning yield. The expansion follows a similar Binance arrangement and comes as Franklin Templeton’s tokenized products surpass $2 billion in assets under management.
Franklin Templeton’s Benji system links BENJI tokens one-for-one to shares of its Franklin OnChain U.S. Government Money Fund, or FOBXX. Institutional users can pledge those tokens at a trading venue while the underlying fund shares stay with a regulated custodian, so the collateral continues to generate yield.
The service already operates on Stellar and Ethereum. Bybit joins Binance, which began accepting the tokens on Feb. 11, 2026. Franklin Templeton’s tokenized products have now passed $2 billion in assets under management, and in August 2026 the SEC issued a no-action letter covering tokenized FOBXX and BENJI use for cash and collateral management.
Institutional traders and exchanges could gain more efficient collateral, potentially reducing the need to move assets onto trading platforms. That may lower counterparty exposure while allowing assets to keep earning yield. Broader market participants may see traditional money-market funds become more integrated with crypto trading infrastructure. Regulators could watch whether tokenized collateral improves stability or raises new oversight questions.