Franklin Templeton – one of the world’s largest global investment managers – has received approval from Luxembourg regulator Commission de Surveillance du Secteur Financier (CSSF) to launch the first fully tokenized UCITS (Undertakings for Collective Investment in Transferable Securities) fund of its kind in Luxembourg.
Shares in the fund will be issued using Franklin’s proprietary blockchain-enabled transfer agency platform. The fund, which is scheduled for launch over the next few months, will be the first tokenized UCITS fund on a public blockchain using in house capabilities and technologies in Luxembourg, and is expected to be distributed widely throughout Europe pending regulatory approval.
Franklin Templeton’s Sandy Kaul, Head of Digital Assets and Industry Advisory Services commented: “Disruptive technology and innovation in financial services is reshaping the industry and changing the fundamental rules for how to attract, secure, and serve clients. We believe that in the future, there may be opportunities to create other tokenized financial products, including interoperability with other digital assets and blockchain native facilities. We are committed to continuing to explore these opportunities as part of our broader digital assets strategy.”
The expansion of this new capability signals Franklin Templeton’s confidence and belief in Web3 and digital technologies which have the potential to reshape the asset management industry by creating new opportunities to more closely link traditional asset management products and services to transactional payments.
In April 2021, Franklin Templeton launched the Franklin OnChain U.S. Government Money Fund, the first U.S.-registered mutual fund to use a public blockchain to process transactions and record share ownership.
Roger Bayston, EVP, Head of Digital Assets, Franklin Templeton added: “We have been active participants and builders in the digital asset ecosystem since 2018 and have seen the transformative power of blockchain technology firsthand.”
The benefits of asset tokenisation include increased liquidity, accessibility, composability and transparency. By applying the benefits of blockchain technology to a traditional product, investors will benefit from efficient transfer and cost-effective administration.
Matt Harrison, Head of Americas (ex-US), Europe & UK at Franklin Templeton concluded: “This new fund will mark a pivotal step in our global commitment to leverage blockchain technology for clients beyond the U.S.”
Franklin Templeton Digital Assets Services (FTDAS) has been active in the digital asset ecosystem since 2018, building blockchain-based technology solutions, developing a range of investment strategies, and running node validators.
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