Payward Inc., the parent company of crypto exchange Kraken, and global asset manager Franklin Templeton announced a strategic partnership on May 12, 2026, to develop tokenized investment products and expand onchain financial infrastructure for both institutional and retail clients.
A Bridge Between Traditional Finance and Crypto Infrastructure
Franklin Templeton, which manages approximately $1.74 trillion in assets under management (AUM), will leverage Payward's xStocks framework—a platform for tokenized equities that has processed over $30 billion in trading volume since its launch in 2025. The collaboration aims to build actively managed investment products directly on blockchain networks, making professionally managed strategies from a major traditional asset manager programmable and tradable onchain.
First Products: Tokenized Fixed Income and Active Strategies
The partnership will initially roll out tokenized fixed-income products targeting institutional clients, with a potential expansion to Kraken's broader user base where regulations permit. These products are designed to emphasize transparency, programmability, and flexibility. Additionally, Kraken will integrate Franklin Templeton's BENJI token—representing shares in the Franklin OnChain U.S. Government Money Fund and related products—for institutional use as collateral or yield-generating instruments in digital markets.
Arjun Sethi, co-CEO of Payward and Kraken, commented: “This partnership opens up a new class of products that would have been impossible just three years ago: assets that carry the credibility of managers with decades of experience and the programmability of digital infrastructure.” Sandy Kaul, head of digital assets and innovation at Franklin Templeton, added: “By expanding the utility of BENJI and exploring new tokenized products, our work with Payward reflects the growing need to serve both digitally native and institutional clients with solutions built for how capital increasingly moves onchain.”
Franklin Templeton's Deep Blockchain Roots
Franklin Templeton has been exploring blockchain integration since 2018. In April 2021, it launched FOBXX, the first U.S.-registered mutual fund to record share ownership on a public blockchain. The fund now operates across Stellar, Solana, Base, Polygon, Aptos, Arbitrum, Avalanche, and other networks. In March 2026, the firm partnered with Ondo Finance to tokenize five of its ETFs for onchain distribution and 24/7 trading. In April 2026, it formed Franklin Crypto by acquiring CoinFund affiliate 250 Digital, with part of the transaction settled in BENJI tokens.
xStocks and Nasdaq Integration
Payward's xStocks framework offers tokenized 1:1 representations of U.S. stocks and ETFs for qualified non-U.S. clients, enabling extended trading hours and DeFi composability including lending and trading on decentralized exchanges. Earlier in 2026, Payward also partnered with Nasdaq to develop specialized token designs for equities that support automated corporate actions, proxy voting, and dividend distributions.
Industry Shift and Risk Considerations
The partnership highlights a broader industry push toward real-world asset (RWA) tokenization. Traditional assets gain blockchain-native advantages such as 24/7 accessibility and composability with DeFi protocols, while onchain infrastructure gains access to regulated, institutional-grade products. Both firms participate in DTCC's tokenization working groups, positioning them as leading integrators of traditional finance and crypto-native infrastructure as institutional demand for onchain products accelerates.
Risks cited in the announcement include regulatory uncertainty, blockchain security vulnerabilities, pricing and settlement accuracy, and operational conditions. Tokenized products are issued and distributed by Payward; Franklin Templeton manages underlying strategies but does not issue or support tokenization platforms. Availability varies by jurisdiction.