Institutional investors will soon be able to use tokenized money market funds not only for trading but also as collateral when obtaining loans.
Singapore’s bank DBS, in partnership with Franklin Templeton and Ripple, signed a Memorandum of Understanding (MoU) to offer institutional investors new trading and lending instruments based on tokenized money market funds and Ripple USD stablecoin (RLUSD).
The key instrument will be the sgBENJI token, a digital version of the Franklin Onchain U.S. Dollar Short-Term Money Market Fund, which will be available on the DBS Digital Exchange paired with the RLUSD stablecoin.
Investors will be able to exchange RLUSD for sgBENJI 24/7, thereby moving assets into a more stable instrument and earning yield even during periods of high market volatility. In the next stage of the collaboration, DBS plans to allow the use of sgBENJI as collateral for loans at the bank through repo transactions and on external platforms.
Franklin Templeton will tokenize sgBENJI on the XRP Ledger blockchain, chosen for its high speed, low fees, and scalability. The instrument provides institutional investors with greater efficiency when working with tokenized assets as well as interoperability within the blockchain ecosystem.
The press release cites a joint study by EY-Parthenon and Coinbase showing that 87% of institutional investors plan to invest in digital assets in 2025.
DBS, Singapore’s largest bank, is actively experimenting with asset tokenization. Less than a month ago, the bank launched a program to tokenize structured notes on the Ethereum blockchain, significantly increasing access to its financial instruments.
