Global investment manager Franklin Templeton has received approval from Luxembourgish regulator Commission de Surveillance du Secteur Financier (CSSF) to launch the first fully tokenised UCITS fund of its kind in the country.
The firm has said in a statement that the fund will launch in the coming months with distribution expected across Europe. Shares in the fund will be issued using its blockchain-enabled transfer agency platform. It is reportedly the first tokenised UCITS fund on a public blockchain using in-house capabilities to be available in the domicile.
Sandy Kaul, head of digital assets and industry advisory services at Franklin Templeton, said: “We want to be known as a leader in developing innovative solutions that align with the needs of our clients’ in terms of business growth, operational efficiency, and scalable best practices. Disruptive technology and innovation in financial services is reshaping the industry and changing the fundamental rules for how to attract, secure, and serve clients.”
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She added: “We believe that in the future, there may be opportunities to create other tokenised 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.”
In April, the firm launched its first Catholic principles ETF. It also launched two green bond ETFs around this time last year, as well as two sustainable thematic ETFs in July 2023. On our sister site PA Future, the firm’s European contingent has also spoken about the development of the green bonds market, which it called an ‘explosion’ in the last half decade.
And now it is launching itself into blockchain, a technology that IBM explains as ‘a shared, immutable ledger that facilitates the process of recording transactions and tracking assets in a business network’. Virtually anything of value, IBM says, can be tracked and traded on a blockchain network, reducing risk and cutting costs for all involved.
The firm said that this move signals its ‘confidence and belief’ in Web3 and digital technologies. These, it said, have the potential to reshape the asset management industry. It also cited its launch in April 2021 of the Franklin OnChain US Government Money fund, which it said was the first mutual fund to use blockchain to process transactions and record share ownership.
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Roger Bayston, EVP and head of digital assets at the firm, said: “We have been active participants and builders in the digital asset ecosystem since 2018 and have seen the transformative power of blockchain technology firsthand. As technological innovation continues at pace, we continue to work closely with regulators around the world to introduce innovative solutions to the marketplace.”
He added: “Leveraging our in-depth knowledge of blockchain ecosystems and proprietary technologies, we are well positioned to introduce products that serve to further the understanding and accessibility of digital assets within the broader community.”
