Franklin Templeton Retrofits Money Market Funds for US Stablecoin Regime

Franklin Templeton is retrofitting two long-running Western Asset institutional money market funds (MMFs) to integrate directly with the emerging US stablecoin regime and tokenized cash infrastructure, rather than creating new crypto-native products. The goal is to allow these SEC-registered 2a-7 MMFs to serve as regulated, government-backed collateral for payment stablecoins. Specifically, the Western Asset Institutional Treasury Obligations Fund (LUIXX) is being positioned for GENIUS Act reserve requirements, while the Treasury Reserves Fund (DIGXX) has added a blockchain-enabled “Digital Institutional” share class for 24/7 onchain collateral use. Franklin Templeton views this as an incremental step, extending their digital stack across existing familiar, SEC-registered wrappers that many large clients prefer, rather than forcing migration to new vehicles. This strategy mirrors efforts by other asset managers, like BlackRock, who are also repositioning regulated cash funds as backend rails for tokenized dollars.

(Source：Cointelegraph)