Summary
- The SEC’s Division of Investment Management has granted no-action relief to Franklin Templeton under Section 17(f) of the Investment Company Act of 1940.
- This relief allows Franklin Templeton’s affiliated transfer agent to act as custodian for investments in shares of a blockchain-recorded money market fund, despite noncompliance with certain custody rules.
- The decision is based on 12 representations regarding the transfer agent's control over securityholder files and ownership records, including private key management.
- This development signals the SEC's evolving stance on digital asset custody frameworks amid increasing scrutiny of tokenized fund infrastructure.
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