Franklin Templeton Brings Tokenised Funds to Hong Kong in Fintech 2030 Breakthrough

Digital trading in Hong Kong has taken a major leap forward with the launch of the city’s first Luxembourg-registered tokenized money market fund by U.S. asset manager Franklin Templeton, marking a milestone in the city’s drive to become a leading global fintech hub.

According to a report from the South China Morning Post, the initiative comes under the Fintech 2030 plan, which was unveiled this week by the Hong Kong Monetary Authority (HKMA) to boost innovation and establish the region as a centre for digital finance and blockchain adoption.

A New Era for Hong Kong’s Digital Markets

The Franklin OnChain U.S. Government Money Fund, which invests in U.S. government securities, was registered in Luxembourg last year and is now available to institutional and professional investors in Hong Kong with at least HK$8 million (US$1 million) in assets.

This move represents a key step toward bringing tokenized investment products into regulated Asian markets. Tokenization enables investors to own blockchain-based digital representations of traditional assets, such as deposits, bonds, and equities — effectively merging traditional finance with digital asset infrastructure.

“This launch reflects our ongoing commitment to delivering innovative investment solutions that address the needs of modern investors by expanding the accessibility of tokenized products in this dynamic market,” said Tariq Ahmad, Franklin Templeton’s head of Asia-Pacific.

Ahmad added that the company plans to eventually launch a retail-approved tokenized fund, pending approval from Hong Kong’s Securities and Futures Commission (SFC), as part of its broader strategy to democratise investment access and strengthen the region’s digital asset ecosystem.

A Pillar of Hong Kong’s Fintech 2030 Vision

The launch marks the first major project under the Fintech 2030 strategy, announced earlier this week by Eddie Yue Wai-man, chief executive of the HKMA.

Eddie Yue Wai-man, chief executive of the Hong Kong Monetary Authority, attends the Global Financial Leaders’ Investment Summit on Tuesday. 

The five-year strategy includes over 40 initiatives aimed at promoting artificial intelligence adoption and the rollout of tokenization products, all designed to bolster Hong Kong’s position as a fintech innovation leader.

Yue said the HKMA envisions an integrated financial ecosystem where banks use tokenized deposits to settle tokenized money market funds and employ central bank digital currency (CBDC) for interbank settlements — an interconnected digital architecture that could redefine how funds and payments flow across institutions.

Building on a Global Track Record

The new fund is also the first Luxembourg-registered tokenized UCITS money market fund issued on a blockchain platform developed by Franklin Templeton. The platform gives investors access to high-quality, short-term U.S. government securities while leveraging blockchain’s transparency and efficiency.

UCITS, or “Undertakings for the Collective Investment in Transferable Securities,” is a European regulatory framework that allows funds to be sold across EU member states, giving Franklin Templeton a strong foundation for cross-border scalability.

Franklin Templeton has been active in developing blockchain-integrated investment products since 2018, steadily building its expertise in merging traditional finance with distributed ledger technology.

In 2021, it launched the world’s first U.S.-registered mutual fund using blockchain to process transactions and record share ownership. The firm then expanded this innovation globally — debuting its first fully tokenized UCITS fund in Luxembourg last year and introducing its first retail tokenized fund in Singapore earlier this year.

Institutional Partnerships Strengthening Hong Kong’s Ecosystem

Franklin Templeton’s Hong Kong debut is being conducted in partnership with HSBC and OSL Group, operator of the city’s first licensed virtual-asset trading platform. The collaboration is part of Project Ensemble, the HKMA’s initiative launched in 2024 to explore tokenized deposit use cases in financial markets.

Under this partnership, HSBC, Hong Kong’s largest lender, has been testing tokenized deposits to support fund flows for OSL customers, aiming to improve settlement efficiency and speed.

“Hong Kong is becoming an institutionally trusted hub for digital assets,” said Brian Chen, head of OSL Wealth Management. “We look forward to bringing Franklin Templeton’s flagship tokenized product to Hong Kong’s professional investors.”

Lewis Sun, global head of domestic and emerging payments at HSBC, said the collaboration underscores “the immense potential of tokenized deposits to facilitate near-instant, 24/7 settlements for tokenized money market funds.”

Fintech 2030 and the Path Forward

The Fintech 2030 plan lays the groundwork for Hong Kong’s transformation into a regional centre for tokenization and AI-powered finance. By prioritising both innovation and regulatory clarity, the HKMA aims to attract more global asset managers and institutional players seeking compliant entry into Asia’s digital-asset ecosystem.

Franklin Templeton’s tokenized fund launch is not just another product rollout — it represents the convergence of traditional asset management and next-generation blockchain infrastructure, signalling a pivotal moment in the evolution of Hong Kong’s financial sector.

As more institutions follow suit, the city could soon emerge as a global testing ground for tokenized finance, bridging the worlds of regulated investment and decentralised technology.