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Tokenized Treasuries Skyrocket in 2024: BlackRock, Franklin Templeton Lead Charge

BlackRock’s BUIDL fund and Franklin Templeton’s FOBXX fund are leading the tokenization of RWA, utilizing public blockchains like Ethereum and Stellar Lumens.

BlackRock’s BUIDL fund and Franklin Templeton’s FOBXX fund are leading the tokenization of RWA, utilizing public blockchains like Ethereum and Stellar Lumens.
Credit: Foretoken Media 2024

NEW YORK – A recent report from Franklin Templeton has revealed the remarkable growth in tokenized treasuries and real-world asset (RWA) protocols in 2024. The report highlighted BlackRock’s BUIDL fund and Franklin Templeton’s FOBXX money market fund, two of the fastest-growing products.

Tokenized Treasuries Surge Past $1.5 Billion Market Cap

The data shows that tokenized treasuries have soared past a $1.5 billion market cap after a 35% surge since April. A breakdown reveals BlackRock’s BUIDL fund has been the largest contributor, growing by 65% since April. Franklin Templeton’s FOBXX money market fund expanded by 27% during the same time.

Notably, the two financial giants earlier this year launched their Bitcoin spot ETFs. Both enjoy investments in the ETFs to the tune of billions. Additionally, both have filed for ether spot ETFs, which market experts expect to be approved in the coming weeks. Arguably, it is through these ETFs that most companies, both issuers and investors, get introduced to the industry, leading to more investments in a variety of related products.

However, the two leading funds differ in that FOBXX is available to retail investors, but BUIDL is only available to institutional investors with a minimum $5 million investment. To find an edge against BlackRock, Franklin Templeton has recently announced that USDC would be supported as an on/off ramp for the fund.

Companies Opt for Public Blockchains for Tokenization

Some of the biggest beneficiaries of the new tokenization trend are leading public blockchains that have the infrastructure to build or participate in. One such leading candidate is Chainlink. The platform, which shared the findings of the recent report on its X account, is built as the universal platform for builders and financial institutions pioneering the future of global markets on-chain. Five years after launching on mainnet, the platform prides itself on being the standard for connecting data and value on-chain.

Ethereum was picked by BlackRock to launch its BUIDL fund, making it a leader in the space. Regarded as the blockchain for building, Ethereum is emerging as a leader in tokenization. Franklin Templeton, on the other hand, launched on Stellar Lumens’ blockchain. The company joined an elite list of financial companies choosing Stellar, including Circle and WisdomTree.

Tokenization: The Future of Finance

The Stellar network facilitates the tokenization of real-world assets. It enables the creation of stablecoins, securities, and other financial instruments through its fast and cost-effective transaction system. These platforms are attracting billions in investment.

As the new world of cryptocurrency merges with traditional finance, market experts anticipate trillions to flow into the industry. For the traditional markets, tokenization offers capital efficiency, cost savings, access to new markets, transparency, and better risk management, among other benefits.

Global Reach and Regulatory Challenges

Speaking at the Consensus event last month, Franklin Templeton CEO Jenny Johnson stated that the best way to understand blockchain is as a node operator on a dozen blockchains, which her company was already doing. She further revealed that one of the benefits of blockchain is that it has global reach, removing any regulatory restrictions.

This has been a major concern for participants who believe the U.S. is enforcing unrealistic regulatory requirements, hindering growth. She added:

"A US mutual fund is only sold in the US. A European fund is sold globally. Guess what, Europe gets the benefits of fees that are paid on that. The US was closed in how they approached it. I do worry that if we’re too closed on this, we will cede leadership to other jurisdictions."


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