Franklin Templeton, one of the world’s largest asset managers with total assets under management (AUM) of almost $700 billion, filed a preliminary prospectus with the U.S. Securities and Exchange Commission (SEC) for a new U.S. Government money market fund that will record the ownership of the fund’s shares on the Stellar blockchain. This is was done on September 3rd 2019.
Some details about this proposed new fund are:
- The fund aims to “maintain a stable $1.00 share price” and to ” provide investors with as high a level of current income as is consistent with the preservation of shareholders’ capital and liquidity.”
- The fund will invest “at least 99.5% of its total assets in Government securities, cash and repurchase agreements collateralized fully by Government securities or cash.”
According to the prospectus, “in the event of a conflict between the blockchain record and the record held by the transfer agent, the transfer agent’s record will be determinative.” Such a discrepancy could “result in a delay of the processing of a purchase and redemption order.”
Franklin Templeton however warns that using distributed ledger technology (DLT) is “untested for mutual funds.”
It is possible to purchase or redeem the funds’s shares via a mobile app. The minimum initial purchase is $20 (for most accounts), but there is minimum investment requirement for further purchases of shares.