How Tokenized Funds Are Moving Traditional Assets Onto Blockchain Networks

Tokenization is evolving from experimental digital assets into a robust infrastructure layer for traditional financial products like money market funds and Treasury-backed instruments. By utilizing blockchain networks as systems of record, firms such as Franklin Templeton have successfully represented fund shares as tokens, exemplified by the BENJI token on the XRP Ledger. This shift allows established asset managers to maintain familiar investment objectives and regulatory protections while modernizing administrative processes like ownership recording and settlement. Recent milestones, including a May 2026 cross-border redemption involving Ondo Finance, JPMorgan’s Kinexys, Mastercard, and Ripple, demonstrate that tokenized assets can achieve sub-five-second settlement outside traditional banking hours. Furthermore, institutional adoption is expanding as firms like Aviva Investors launch tokenized share classes of liquidity funds. These developments highlight a transition toward interoperability, where blockchain infrastructure integrates with existing custody, payment, and settlement systems. Ultimately, this trend proves that tokenization enhances operational efficiency without requiring the creation of entirely new investment categories.