Franklin Templeton, Bybit launch tokenized collateral program for institutions
The partnership first introduces an off-exchange collateral program that allows eligible Bybit clients to use tokenized money market fund shares as collateral for trading.
Bybit and Franklin Templeton are collaborating to bring tokenized investment products to institutional and wallet-based investors, the companies announced on Sept. 28.
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Bybit and Franklin Templeton Form Strategic Collaboration to Expand Access to Tokenized Investing
The wider collaboration launches with a new off-exchange collateral program that unlocks trading liquidity for institutional clients, alongside… pic.twitter.com/tjgglM0YwQ
— Franklin Templeton Digital Assets (@FTDA_US) September 28, 2026
Their first initiative is focused on using tokenized money market fund shares as off-exchange collateral. The shares are issued through Franklin Templeton’s Benji Technology Platform, its blockchain-integrated infrastructure for recordkeeping and transfer agency services.
Through ByCustody, eligible investors can pledge the tokenized fund shares to obtain USDT or USDC trading credit lines on Bybit without transferring the underlying assets onto the exchange, Franklin noted.
The assets remain in regulated custody while their value is reflected in Bybit’s trading environment, allowing clients to retain exposure to yield-bearing investments while accessing trading liquidity. Bybit said the arrangement can reduce counterparty exposure and support capital efficiency and treasury management.
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The collaboration will also bring a tokenized wealth product to Bybit and the Mantle chain, giving wallet-based investors access to Franklin Templeton investment strategies.
Bybit and Franklin Templeton also plan educational content for retail investors covering traditional investment approaches, goals-based investing and diversification.
Franklin has been expanding the use of tokenized funds as trading collateral through other crypto platforms. It previously developed an institutional offering with Binance that lets clients use shares from its tokenized money market fund as off-exchange collateral, with Ceffu handling custody and settlement.
Disclosure: This article was edited by Kaye Quema. For more information on how we create and review content, see our Editorial Policy.
