The U.S. Securities and Exchange Commission has cleared Franklin Templeton funds to use the BENJI onchain system for cash management, allowing a major asset manager to route fund cash operations through blockchain rails rather than conventional back-office processes.

The clearance came through the SEC's Division of Investment Management, which issues no-action and interpretive letters that reflect staff positions on how registered funds may operate. The development was reported by The Block.

Franklin Templeton has been among the most aggressive traditional asset managers in adopting blockchain infrastructure. The firm operates a tokenized U.S. government money fund whose shares are recorded on the Stellar and Polygon blockchains through its proprietary BENJI transfer-agent system, which has served as a live test of public-chain recordkeeping under registered-fund rules since 2023.

What the SEC clearance allows Franklin Templeton funds to do

The clearance permits Franklin Templeton funds to use BENJI, an onchain system, within their cash management workflows. It applies to fund operations, not to a retail token launch or a yield product marketed to individual investors. For related coverage, see Artificial Intelligence Summit –Malaysia 2026.

In practical terms, the change allows the funds to handle cash management functions using a blockchain-based system rather than only traditional recordkeeping. This is an operational permission tied to how the funds manage cash, and it is separate from crypto trading activity. For related coverage, see Fintech Revolution Summit –Singapore 2026.

The action builds on earlier SEC staff guidance allowing Franklin funds to treat an onchain money fund as cash and collateral, extending that posture into day-to-day cash management. That lineage matters because each incremental staff position gives registered funds a clearer picture of which onchain activities the SEC's investment management division will accommodate. For related coverage, see Ethereum Staking Reaches 34% as Proposal Targets Validator Rewards.

Why BENJI matters for onchain fund infrastructure

BENJI is described in the reporting as infrastructure for onchain cash management, meaning it functions as operational plumbing rather than as a consumer-facing product. That makes this an infrastructure story, not a yield or liquidity story.

Shifting cash management onto blockchain rails can affect how fund transactions are settled and recorded, potentially streamlining operational steps that currently run through separate systems. The significance here lies in a large asset manager—over $1.5 trillion in assets under management—integrating those rails into regulated fund processes, as described by The Block's reporting.

Institutional use of blockchain infrastructure is important for tokenized finance because operational tooling is where these systems are tested against real fund requirements. The SEC staff sign-off indicates a degree of regulatory comfort with that tooling inside a registered fund context, a signal other firms exploring similar infrastructure are likely to note as the tokenization of money-market and treasury-bill products accelerates across the industry.

What this could mean for regulated tokenized finance

Regulatory clearance is often a prerequisite for wider institutional implementation, so a staff position of this kind can serve as a reference point for other asset managers considering similar onchain workflows.

The move sits at the intersection of traditional fund oversight and blockchain infrastructure, an area also touched by broader policy efforts such as the crypto market structure legislation advancing in Congress. Issuers including BlackRock, with its BUIDL tokenized fund on Ethereum, and Ondo Finance have pushed tokenized treasury products into the market, creating a competitive backdrop in which back-office modernization becomes a differentiator. A single clearance for one fund family, however, is not the same as broad regulatory acceptance across the industry.

Whether other registered funds follow will depend on how SEC staff treats comparable requests, and the current letter applies only to the Franklin Templeton funds it addresses.