Franklin Templeton has made its tokenized U.S. government liquidity fund available through Hong Kong-based HashKey’s Earn channel, giving professional clients in the region another route to access on-chain money market products backed mainly by U.S. government securities and dollar cash assets.
HashKey announced that the Franklin OnChain U.S. Government Liquidity Fund will be offered exclusively to professional investors. The product is not available to Hong Kong’s retail public, keeping the rollout within the city’s existing framework for higher-risk and more complex virtual-asset-related offerings.
The distribution arrangement extends Franklin Templeton’s effort to place conventional fund products onto blockchain infrastructure in Asia. Tokenized fund shares can be recorded and transferred on a distributed ledger, potentially streamlining ownership records and allowing platforms to integrate subscriptions, redemptions and collateral functions more directly with digital-asset systems.
HashKey provides a regional distribution route
Franklin Templeton’s partnership with HashKey gives the U.S. asset manager access to a platform with operations spanning Hong Kong, Singapore, Tokyo, Dubai and Bermuda. Roger Bayston Karkhanis, senior vice president of digital assets client engagement at Franklin Templeton, said the companies intend to expand their work beyond tokenized money market funds into other tokenized products over time.
That ambition places HashKey in a distribution role rather than merely a trading venue. Its Earn channel is designed to offer yield-generating products, making a tokenized government fund a practical fit for professional clients seeking dollar-denominated cash management tools alongside digital-asset holdings.
For institutions and professional market participants, tokenized Treasury and money market products can provide a familiar underlying asset in a format built for blockchain wallets and settlement systems. The fund’s focus on U.S. government money market instruments gives it exposure to short-term government debt and cash-equivalent assets rather than the price swings associated with cryptocurrencies.
Hong Kong has already hosted Franklin Templeton’s first fund launch
The HashKey rollout follows Franklin Templeton’s November 2025 launch of the Franklin OnChain U.S. Government Money Fund, described as Hong Kong’s first tokenized money market fund. That earlier launch formed part of the Hong Kong Monetary Authority’s Fintech 2030 strategy, which includes work on tokenization and financial-market infrastructure.
Hong Kong has been positioning itself as a regulated venue for tokenized financial products, while maintaining clear distinctions between services available to professional clients and those marketed to retail users. Limiting the Franklin fund’s availability narrows its immediate audience, but also places the product inside a market structure designed for regulated institutional participation.
The approach differs from the retail-focused strategy used by some digital-asset platforms. Franklin Templeton and HashKey are targeting firms, family offices and other eligible professional clients that may already use dollar liquidity products, custody services or blockchain-based settlement tools.
Treasury tokens account for a large share of the market
The partnership arrives as tokenized real-world assets continue to expand, led by government debt products. RWA.xyz, a blockchain-data platform tracking tokenized assets, put the real-world asset tokenization market at $38.2 billion on Aug. 23, compared with $20.6 billion a year earlier.
Tokenized U.S. Treasury products represented $15.6 billion of that total, according to RWA.xyz. The figure shows that short-duration government instruments have become one of the largest categories in on-chain finance, ahead of more experimental efforts to tokenize equities, credit and physical assets.
Their appeal is relatively straightforward: government debt instruments offer a yield-bearing alternative to idle stablecoin balances and can be structured around established money market fund rules. Recording ownership on-chain can also make those products easier to use in blockchain-native collateral arrangements, subject to the terms of each fund and the restrictions of local regulation.
The market’s growth does not mean tokenized funds operate without conventional financial controls. Fund managers still determine portfolio strategy, service providers handle custody and administration, and purchasers must meet eligibility requirements. Blockchain changes the form of the fund share and its operational rails, rather than replacing the underlying assets or the manager’s obligations.
A test of demand beyond cryptocurrency trading
Franklin Templeton’s decision to work with a regulated regional platform gives it a way to test whether demand for tokenized cash-management products extends beyond direct cryptocurrency trading. Professional clients that hold digital assets often need a place to park dollar liquidity without moving entirely out of blockchain-based systems.
The fund could help connect those two functions: conventional short-term government exposure on one side and wallet-based digital-asset infrastructure on the other. Its usefulness will depend on practical factors including subscription and redemption processes, eligible jurisdictions, wallet support, custody arrangements and how readily the token can be used within compliant financial workflows.
The collaboration also adds to competition among major asset managers and tokenization platforms seeking to distribute regulated on-chain products in Asia. Franklin Templeton has been among the established fund groups pursuing tokenized offerings, while HashKey brings a regional platform footprint that could support future product launches across several financial centers.
For now, the immediate development is a narrowly targeted distribution agreement for a tokenized U.S. government liquidity fund. Its broader value to Franklin Templeton will rest on whether professional clients use the product as a recurring on-chain treasury-management tool and whether the partnership can move from a single fund to a larger range of regulated tokenized assets.
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