Franklin Templeton Teams Up With Ondo Finance to Launch Tokenised ETFs Accessible From Crypto Wallets
The partnership introduces on‑chain versions of the asset manager’s exchange‑traded funds, expanding distribution beyond traditional brokerage channels and offering 24/7 market exposure for crypto‑native investors.
Overview
Franklin Templeton announced a collaboration with blockchain‑based platform Ondo Finance to bring tokenised representations of several of its ETFs onto public‑chain networks. The tokens will be issued through a special‑purpose vehicle that purchases the underlying ETF shares and then mints on‑chain assets that convey the economic rights of those shares to holders. Investors will be able to receive and trade the tokens directly from standard cryptocurrency wallets, using them as collateral or integrating them into DeFi protocols.
The arrangement, first reported by Bloomberg and later confirmed by Ondo on its official X account, marks the latest effort by a major traditional asset manager to experiment with blockchain‑enabled distribution. While the rollout will initially cover Europe, the Asia‑Pacific region, the Middle East and Latin America, entry into the United States will depend on forthcoming regulatory guidance.
How the Tokenised ETFs Work
- Acquisition & SPV structure – Ondo Finance will acquire the physical ETF shares from Franklin Templeton and place them into a dedicated special‑purpose vehicle (SPV). The SPV then issues ERC‑20‑compatible tokens that reflect the economic performance of the underlying funds.
- Economic exposure, not direct ownership – Token holders receive rights to the fund’s returns (price appreciation, dividends, etc.) but do not own the actual ETF shares. This design simplifies on‑chain transferability while keeping the legal ownership of the securities within the SPV.
- DeFi‑ready functionality – Because the tokens are standardised digital assets, they can be used as collateral on lending platforms, be incorporated into liquidity pools, or be traded on decentralized exchanges.
- Liquidity provision – Ondo’s network of market makers will supply liquidity, including outside regular market hours, enabling round‑the‑clock trading.
Initial Offering
The first batch will consist of five tokenised funds covering three asset classes:
- U.S. equity ETFs – exposure to large‑cap American stocks.
- Fixed‑income ETFs – diversified bond exposure.
- Gold‑linked ETFs – a digital hedge against inflation and market volatility.
Tokens will be distributed via Ondo Global Markets, the firm’s on‑chain brokerage interface. Neither Franklin Templeton nor Ondo responded to requests for further comment at the time of publication.
Regulatory backdrop
The partnership follows a period of heightened regulatory clarity for Ondo Finance. In December 2025, the U.S. Securities and Exchange Commission closed a multi‑year investigation into the company without filing any charges, clearing the way for broader market participation. Nonetheless, U.S. investors will not have immediate access to the tokenised ETFs until the SEC or other relevant bodies provide explicit guidance on how such on‑chain securities can be offered domestically.
The wider tokenised equity landscape
Tokenised equities have witnessed rapid growth over the past twelve months. Data from RWA.xyz shows the total market value of tokenised stocks rising from roughly $500 million in early 2025 to close to $950 million by March 2026. Ondo Finance currently commands about 60 % of that market, with roughly $562 million of assets under tokenisation. Competing platforms such as Backed Finance (xStocks) and Securitize hold smaller, but still significant, shares.
Other major crypto‑exchange operators are also expanding into the space:
- Kraken launched regulated tokenised equity perpetual futures for non‑U.S. clients in February, granting 24/7 leveraged exposure to major U.S. indexes and individual stocks.
- Coinbase rolled out a similar perpetual‑future product last week, extending round‑the‑clock equity access to eligible overseas users.
- The New York Stock Exchange signed a partnership with Securitize to explore a 24/7 blockchain‑based trading platform for stocks and ETFs, although a timeline for U.S. retail availability remains uncertain.
These developments indicate a broader industry push toward integrating traditional securities with crypto infrastructure, even as regulators in the United States grapple with the legal framework for on‑chain securities.
Analysis
The Franklin Templeton‑Ondo collaboration highlights several emerging trends:
- Diversification of distribution channels – By moving ETF exposure onto public blockchains, asset managers can reach investors who prefer crypto wallets over brokerage accounts, potentially tapping into a younger, digitally native client base.
- Continuous market access – Tokenised ETFs can be traded outside the confines of the traditional exchange schedule, appealing to investors seeking liquidity at any hour.
- Regulatory nuance – The structure carefully isolates legal ownership of the securities within an SPV, a common approach to satisfy securities law while still offering on‑chain utility. The U.S. market, however, remains a bottleneck pending clearer guidance.
- Competitive pressure – With Ondo already holding a dominant share of the tokenised equity market, legacy managers like Franklin Templeton may feel compelled to partner with established crypto infrastructure providers rather than building solutions from scratch.
- DeFi integration – The ability to use tokenised ETF positions as collateral could stimulate new borrowing‑lending products and composite financial strategies that blend traditional asset performance with crypto yield mechanisms.
Key Takeaways
- New product class: Franklin Templeton will offer five tokenised ETFs via Ondo Finance, tradable 24/7 from standard crypto wallets.
- Geographic scope: Launch covers Europe, APAC, the Middle East and Latin America; U.S. participation awaits regulatory clarity.
- Structure: An SPV purchases the underlying ETF shares and mints ERC‑20 tokens that convey economic rights, not direct ownership.
- Liquidity: Ondo’s market makers will provide continuous liquidity, extending trading beyond conventional market hours.
- Market impact: The move adds a high‑profile traditional asset manager to a tokenised equity market that has nearly doubled in value over the past year, with Ondo retaining a 60 % share of overall volume.
- Regulatory environment: The partnership follows the SEC’s decision to close its investigation into Ondo, but U.S. investors remain excluded pending further guidance.
- Industry trend: The launch mirrors similar initiatives from Kraken, Coinbase, and NYSE‑Securitize, signalling a broader industry shift toward on‑chain securities.
As the tokenised securities ecosystem matures, the success of Franklin Templeton’s on‑chain ETFs will likely serve as a bellwether for other legacy asset managers considering similar blockchain‑driven distribution strategies.
Source: https://cointelegraph.com/news/franklin-templeton-ondo-to-launch-tokenized-etfs-with-24-7-trading-via-crypto-wallets?utm_source=rss_feed&utm_medium=feed&utm_campaign=rss_partner_inbound
