TLDR:
- Eligible clients can use Franklin Templeton’s tokenized money market funds as Binance trading collateral
- Assets remain in third-party Ceffu custody while value is mirrored within Binance’s trading environment
- Program reduces counterparty risk while enabling institutions to earn yield on collateral assets
- Initiative represents first concrete implementation of September 2025 strategic partnership agreement
Binance and Franklin Templeton have launched an institutional collateral program enabling tokenized money market fund shares as trading collateral.
The program allows eligible clients to use assets issued through Franklin Templeton’s Benji Technology Platform as off-exchange collateral on Binance.
This marks the first initiative under their strategic partnership announced in September 2025. The program aims to improve capital efficiency while reducing counterparty risk.
Off-Exchange Collateral Program Reduces Risk for Institutional Traders
The new program addresses a major challenge facing institutional market participants. Traders can now use tokenized money market fund shares as collateral without parking assets on an exchange.
The collateral value is mirrored within Binance’s trading environment through Ceffu’s custody infrastructure. Meanwhile, the actual tokenized assets remain securely held off-exchange in third-party custody.
This structure reduces counterparty risk for institutional clients. Traders earn yield on their money market fund holdings while supporting trading activity.
The arrangement eliminates choosing between custody security and trading flexibility. Institutions maintain regulatory protections on their assets throughout the process.
Ceffu, Binance’s institutional crypto-native custody partner, provides the underlying infrastructure. The custody layer enables assets to stay off-exchange while their value supports trading positions.
“Institutions increasingly require trading models that prioritize risk management without sacrificing capital efficiency,” said Ian Loh, CEO of Ceffu.
Binance announced the program launch on social media. The exchange highlighted that this initiative represents the first step under their collaboration with Franklin Templeton. The partnership focuses on bridging traditional finance with digital asset markets.
Traditional Finance and Digital Assets Converge Through Tokenization
Roger Bayston, Head of Digital Assets at Franklin Templeton, emphasized the partnership’s institutional focus. “Since partnering in 2025, our work with Binance has focused on making digital finance actually work for institutions,” Bayston said.
He added that the off-exchange collateral program lets clients put their assets to work in third-party custody while safely earning yield. That’s the future Benji was designed for, he noted.
Catherine Chen, Head of VIP & Institutional at Binance, described the collaboration as a natural progression. “Partnering with Franklin Templeton to offer tokenized real-world assets as off-exchange collateral is a natural next step in our mission,” Chen stated.
She explained that innovating ways to use traditional financial instruments on-chain opens new opportunities for investors. The approach shows how blockchain technology can make markets more efficient, according to Chen.
The program responds to institutional demand for specific collateral characteristics. Institutions seek stable, yield-bearing assets supporting continuous settlement cycles. Tokenized money market funds meet these requirements while fitting existing governance frameworks.
Market infrastructure must align with institutional standards to support broader adoption. Binance positions the program as meeting demand for stable collateral on regulated platforms.
Enhanced capital efficiency benefits traders managing positions across both traditional and digital markets.
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