Franklin Templeton, managing roughly $1.7 trillion in assets, has partnered with Ondo Finance to launch tokenized ETFs on the Ethereum blockchain, enabling 24/7 trading through crypto wallets and bypassing traditional brokerage accounts entirely.
The partnership, announced March 25, 2026, covers five ETFs spanning U.S. equities, fixed income, and gold exposure. The products are initially available in Europe, Asia-Pacific, the Middle East, and Latin America, with U.S. availability pending regulatory clarity around third-party distribution of registered funds on-chain.
~$1.7T
Assets under management — Franklin Templeton
Source: Franklin Templeton
What the Tokenized ETF Structure Actually Looks Like
Under the arrangement, Ondo Finance acquires ETF shares and issues blockchain tokens representing economic exposure to those shares. This is a critical distinction: the tokens do not grant direct ownership of the underlying ETF shares. Holders gain price exposure and economic returns, but the legal ownership structure runs through Ondo’s intermediary layer.
The tokens are issued on Ethereum, which currently hosts over $13 billion in tokenized assets. Investors interact with the products through crypto wallets rather than traditional brokerage accounts, removing the need for conventional intermediaries in the trading process.
Sandy Kaul, Head of Innovation at Franklin Templeton, framed the launch as a market test: “These ETFs represent a good mix of different exposures. And it gives a good test case for us to see what is really striking the appetite of a new audience.”
This is not Franklin Templeton’s first blockchain product. The firm launched its Benji Technology Platform in 2021 and brought the Franklin OnChain U.S. Government Money Fund (FOBXX) on-chain, which grew to $557 million in AUM by February 2026. That fund was the first SEC-registered fund to use blockchain for transaction processing.
Why On-Chain Settlement Changes the Mechanics
Traditional ETFs trade during NYSE hours (9:30 a.m. to 4:00 p.m. ET) and settle on a T+1 basis, meaning ownership transfer completes one business day after the trade. Weekends, holidays, and after-hours periods are dead zones for execution.
24 / 7
Trading availability via crypto wallets, vs. standard market hours for traditional ETFs
Source: Franklin Templeton product announcement
Blockchain-based settlement compresses that timeline to minutes. There is no clearing house intermediary; ownership transfers are recorded directly on Ethereum. For investors in time zones far from New York, or those reacting to overnight market-moving events, this removes a structural disadvantage.
The “24/7 via crypto wallets” framing does come with caveats. Tokenized securities typically operate on permissioned rails, meaning wallets may need to be whitelisted and users must pass KYC/AML checks before trading. This is not the same as unrestricted DeFi access. Whether dividends or distributions are handled on-chain has not been detailed in the announcement.
The growth of stablecoin payment infrastructure is creating the plumbing that makes institutional on-chain products like these viable for everyday settlement.
A Crowded Institutional Race to Tokenize Real-World Assets
Franklin Templeton is not moving in isolation. BlackRock launched its BUIDL tokenized fund on Ethereum in March 2024, and it has since surpassed $500 million in AUM. BlackRock’s broader push into digital assets now spans both crypto-native ETFs and tokenized traditional products. WisdomTree is also exploring similar initiatives.
Will Peck of WisdomTree drew a comparison to the original ETF wave: “No one at the time was like, ‘I want an ETF.’ The ETF just worked better. That same pattern may now apply to tokenized products.”
Ondo Finance brings significant distribution capacity to the partnership, reporting over $620 million in total value locked and more than $12 billion in cumulative trading volume across 60,000 users. The platform’s existing infrastructure for issuing blockchain tokens backed by traditional financial assets made it a natural counterpart for Franklin Templeton’s ETF lineup.
The broader tokenized real-world asset market continues to expand. Institutional survey data shows 73% of institutional investors plan to increase digital asset allocations in 2026, even as the broader crypto market sits in a period of extreme fear, with the Fear and Greed Index at 14.
Regulatory Barriers Keep the U.S. on the Sidelines
The most notable gap in the launch is the United States. Franklin Templeton has explicitly excluded U.S. availability pending clarity on how third parties can distribute SEC-registered funds on-chain. The question centers on compliance, investor identification requirements, and fund registration rules that were not designed for blockchain-based distribution.
The GENIUS Act, passed in July 2025, established stablecoin-specific regulations including a 100% reserve mandate, but did not address the broader question of tokenized fund distribution. The SEC has classified XRP as a commodity alongside Bitcoin and Ethereum, but ETF-related regulatory decisions remain a moving target.
The non-U.S.-first strategy may prove significant beyond regulatory necessity. Regions like Asia-Pacific and Latin America have less developed retail brokerage infrastructure, meaning on-chain ETF access could fill a gap that barely exists in the U.S. market. If tokenized ETFs gain traction internationally first, U.S. regulators may face growing pressure to accommodate the model.
Franklin Templeton has not disclosed a pricing or fee structure for the tokenized products, nor has it specified a timeline for potential U.S. availability.
Disclaimer: This article is for informational purposes only and does not constitute financial or investment advice. Cryptocurrency and digital asset markets carry significant risk. Always do your own research before making decisions.
