TL;DR
- Franklin Templeton and Binance launch an off-exchange collateral program using tokenized money market fund shares.
- The underlying assets remain in third-party custody, not on the exchange’s balance sheet.
- Traders earn yield on their collateral while maintaining full trading capacity.
Franklin Templeton and Binance went live with an institutional off-exchange collateral program that allows eligible clients to use tokenized money market fund (MMF) shares as collateral when trading on Binance. The shares come from Franklin Templeton’s Benji Technology Platform, and the program operates through Ceffu, Binance’s institutional custody partner. The structure keeps the underlying tokenized assets in third-party custody rather than on the exchange itself.
The arrangement solves a friction point that institutional traders have carried for years. Traders can now use regulated, yield-bearing money market fund assets to support their positions in digital markets without moving those assets onto an exchange.
The value of the fund shares appears within Binance’s trading environment, but the tokenized assets themselves remain securely held off-exchange. Counterparty risk drops because custody sits outside the exchange. Traders earn yield while maintaining trading capacity, and they do not sacrifice liquidity, regulatory protections, or control over asset location.
Roger Bayston, Head of Digital Assets at Franklin Templeton, described the program as a practical application of what the partnership aimed to deliver from the start. Since the two firms announced their collaboration in 2025, the work centered on building infrastructure that serves institutional needs without forcing compromises on custody or risk management.
The off-exchange collateral model executes exactly on that objective — clients hold assets in third-party custody, earn yield, and deploy capital in trading activity simultaneously.
Why Tokenized Collateral Addresses a Real Demand in Modern Markets
Catherine Chen, Head of VIP & Institutional at Binance, positioned the program as part of a broader convergence between traditional finance and digital asset markets. Institutions now seek stable, yield-bearing collateral capable of supporting 24/7 settlement cycles while integrating into governance and risk frameworks built for traditional finance.
Ian Loh, CEO of Ceffu, pointed out the shift in what institutions require from trading models. Risk management sits at the top of the list, but capital efficiency cannot drop as a result. The off-exchange collateral structure addresses both.
Traders manage exposure without locking capital in idle positions. The collateral earns yield during the entire period it backs trading activity, which makes the capital allocation more productive than parking assets on an exchange with no return.
The Franklin Templeton-Binance program delivers a tested product — money market fund shares — inside a custody and settlement framework designed for digital markets.
The program builds on a partnership announced earlier in 2025 and reflects how TradFi firms and crypto platforms now collaborate on infrastructure rather than compete for client attention. The result: institutional clients gain access to yield-bearing collateral without choosing between traditional financial protections and the operational benefits of blockchain settlement.
