Franklin Templeton Launch Hong Kong’s First Tokenized Money Fund

Hong Kong’s First Tokenized Money Fund Marks Fintech 2030 Breakthrough

Global investment firm Franklin Templeton has launched Hong Kong’s first tokenized money fund, marking a major step in the city’s vision to become a leading fintech hub in this rapidly digitalizing world. 

Source: FranklinTempleton

The project, called the Franklin OnChain U.S. Government Money Fund, is the first Luxembourg-registered tokenized UCITS fund (a type of regulated European investment-fund) that is now open to institutional and professional investors in Hong Kong.

A Milestone for Hong Kong’s Fintech 2030 Strategy

The launch aligns with the Hong Kong Monetary Authority’s (HKMA) Fintech 2030 plan, announced a few days before by Chief Executive Eddie Yue Wai-man. The plan introduces over 40 measures to promote blockchain, artificial intelligence (AI), and financial innovation in the region. 

Source: info.gov.hk

As a part of this roadmap, the Monetary Authority is testing tokenized-deposits and fund-settlements, which could further connect with a central bank digital currency (CBDC) for faster and safer interbank payments. 

Along with that Franklin Templeton’s project involves the collaboration with HSBC and OSL Group, one of in-land licensed virtual asset platforms, to test how tokenized-deposits can connect traditional finance with blockchain. 

How the Tokenized Fund Works

The Franklin OnChain U.S. government Money Fund invests in short-term U.S. government securities, offering investors stable returns, capital protection, and liquidity.

Each investor receives blockchain-based tokens that represent shares of the fund-pool, recorded and managed through Franklin Templeton’s proprietary blockchain recordkeeping system.

This structure allows: 

• Faster and more transparent transactions

• Lower operational costs

• Secure and verifiable digital ownership

According to the investment giant, this the first end-to-end tokenized investment product in Hong Kong, covering issuance, distribution, and servicing, all on distributed networks. 

Global Shift Toward Tokenization

Asset Tokenization – converting real-world assets or RWA into blockchain -based tokens, is gaining global momentum as institutions seek more efficiency and transparency in systems especially in this swiftly moving era of virtual money. 

According to Standard Chartered Bank, the market cap of tokenized real-world assets (RWAs), excluding stablecoins, is expected to surge to $2 trillion by 2028 from around $35 billion today, marking a 5,600% increase in just a few years. 

A separate report by Ripple and Boston Consulting Group also predicts that the tokenization market could reach $19 trillion by 2033, as financial institutions increasingly explore blockchain-based issuance of funds, bonds, and deposits.