San Francisco-based blockchain firm Ripple has announced a major partnership with Franklin Templeton, a global asset manager that boasts $1.5 billion worth of assets, and DBS Bank, the largest banking institution, in order to develop repo markets powered by stablecoins and tokenized collateral.
As part of the partnership, Franklin Templeton’s sgBENJI token, which represents shares in a tokenized U.S. dollar short-term money market fund, will be listed on the Singaporean exchange. It will be possible to instantly exchange it for the RLUSD stablecoin, which will also be listed on the trading platform.
Instead of holding volatile tokens with no yield, investors will have an opportunity to instantly move into a safer yield-bearing product during times of volatility.
Repo markets on blockchain rails
The next phase of the partnership will include using sgBENJI tokens as collateral and receiving credit from DBS or another third-party lender in cash or stablecoins.
This will function as a typical repo market in traditional finance when financial institutions use U.S. Treasuries as collateral in order to secure short-term loans and unlock more liquidity.
More adoption for XRPL and RLUSD
Notably, Franklin Templeton will issue the sgBENJI token on the XRP Ledger network as well as several other blockchains. Ripple argues that XRPL is a perfect fit for high-volume MMF tokens.
Meanwhile, Ripple's RLUSD stablecoin, whose market cap is currently approaching $730 million, will be the base currency for trading sgBENJI.
Ripple's Nigel Khakoo claims that enabling repo trades for a tokenized MMF with the help of the stablecoin would be a "game changer."
Dan Burgin
Vladislav Sopov
U.Today Editorial Team
