DBS, Franklin Templeton, and Ripple Collaborate on Tokenized Trading and Lending Services
DBS, Franklin Templeton, and Ripple have come together to introduce tokenized trading and lending services for institutional investors, utilizing the XRP Ledger and supported by tokenized money market funds and stablecoins.
The three entities have signed a memorandum of understanding (MOU) aimed at assisting investors in managing market volatility more effectively by providing a mechanism to transfer funds between stablecoins and yield-generating assets, as announced on Thursday.
“Digital asset investors need solutions that can meet the unique demands of a borderless 24/7 asset class,” stated Lim Wee Kian, CEO of DBS Digital Exchange. “This partnership demonstrates how tokenized securities can fulfill that role while infusing increased efficiency and liquidity in global financial markets,” he added.
DBS Digital Exchange (DDEx) is set to list sgBENJI, a tokenized counterpart of Franklin Templeton’s US Dollar Short-Term Money Market Fund, along with Ripple USD (RLUSD). This arrangement will enable clients to trade between RLUSD and sgBENJI at any time, assisting them in quickly rebalancing their portfolios and earning yields amidst fluctuating market conditions.
In the next phase, DBS intends to allow clients to utilize sgBENJI as collateral to obtain credit, either through repurchase agreements with the bank or third-party lending platforms, with DBS serving as the collateral agent.
Franklin Templeton will issue sgBENJI on the XRP Ledger, which was selected for its low fees and rapid settlement times.
Ripple’s Nigel Khakoo described the initiative as a “game-changer,” highlighting that investors will be able to transition between a stablecoin and a tokenized fund within a “single, trusted ecosystem,” thereby unlocking real-world capital efficiency, utility, and liquidity that institutions need.
This initiative addresses a rising interest among institutions for regulated, on-chain products. A recent survey conducted by Coinbase and EY-Parthenon revealed that 87% of institutional investors anticipate allocating funds to digital assets by 2025.
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DBS, Franklin Templeton, and Ripple’s proposal to launch tokenized lending comes during a period where tokenized assets are gaining traction in global capital markets.
As reported, SBI Shinsei Bank has teamed up with Singapore’s Partior and Japan’s DeCurret DCP to investigate multicurrency tokenized deposits intended for cross-border settlements. This trio has signed an MOU to create a blockchain-based framework that allows for real-time clearing across multiple currencies.
The aim is to establish a 24/7 global settlement network that diminishes the dependency on traditional correspondent banking.
