The U.S. Securities and Exchange Commission's Division of Investment Management has issued a no-action letter to Franklin Templeton, permitting its registered funds to use the on-chain money market fund FOBXX, also known as BENJI, to manage cash and collateral via blockchain instead of following traditional custody rules. The letter, issued under Section 17(f) of the Investment Company Act of 1940 and Rule 17f-2, allows registered funds to hold FOBXX shares without satisfying certain physical vault requirements. This supports intraday trading, hourly net asset value calculations, and faster transaction processing. FOBXX primarily invests in U.S. government securities, aims to maintain a stable share price of $1, and has expanded to multiple blockchains. The development was reported by CoinDesk.
Franklin Templeton has received a no-action letter from the U.S. SEC's Division of Investment Management, clearing its registered funds to manage cash and collateral through FOBXX, an on-chain money market fund also known as BENJI, instead of sticking to traditional custody rules.
The letter, reliant on Section 17(f) of the Investment Company Act of 1940 and Rule 17f-2, allows those funds to hold FOBXX shares without meeting certain physical vault requirements. That opens the door to intraday trading, hourly net asset value calculations, and faster transaction settlement.
FOBXX holds mostly U.S. government securities, aims to keep a stable $1 share price, and has expanded across multiple blockchains. ChainCatcher reports, citing CoinDesk.
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