Global financial giants Franklin Templeton and Citigroup have announced plans to use the Solana blockchain for their upcoming financial services.
Franklin Templeton, a $1.4 trillion asset manager, plans to launch a mutual fund on Solana, while Wall Street giant Citi is exploring the blockchain’s potential for smart contracts and cross-border money transfers.
The announcements were made at the Solana Breakpoint 2024 event in Singapore on September 20, highlighting the growing interest of traditional financial (TradFi) institutions in DeFi solutions. Both companies said they view Solana as a valuable platform due to its low transaction fees and ability to support large numbers of transactions, positioning it as an ideal blockchain for their services.
Franklin Templeton’s blockchain strategy
Franklin Templeton’s decision to launch an investment fund on the Solana blockchain highlights the asset manager’s continued integration of blockchain technology into its operations.
Mike Reed, the company’s head of partnership development, explained at the event that Solana’s cost-efficiency and scalability were key factors behind the decision. He said:
“We view blockchain as essential for driving operational efficiency and reducing costs in our financial services. Solana provides the transaction capacity we need to handle the volume of general ledger postings for an investment fund, making it the right choice for this initiative.”
The new investment fund will operate natively on Solana’s blockchain, further strengthening Franklin Templeton’s position as a leader in blockchain-based financial services.
A recent report published by the company praised Solana’s resilience and potential for supporting a new wave of crypto innovation. Despite the risks associated with blockchain investments, the report highlights that the network is well positioned for the future of decentralized finance.
The move builds on Franklin Templeton’s existing presence in the crypto space. The company already manages spot exchange-traded funds (ETFs) for Bitcoin and Ethereum, which are listed on the Chicago Board Options Exchange (CBOE).
Citibank keeps an eye on cross-border payments
Meanwhile, Citi said it is exploring the Solana blockchain’s potential to enable seamless cross-border money transfers and deploy smart contracts. According to its representatives at the event, the bank sees blockchain as the future of finance.
Citibank has already been testing blockchain applications in other areas of its business, having used the Avalanche blockchain to tokenize private equity funds earlier this year. Solana’s scalability and speed make it an attractive option for the lender’s continued exploration of blockchain for financial services.
The announcements from Franklin Templeton and Citibank signal a broader trend of increasing blockchain adoption by major financial institutions. Solana’s ability to handle high transaction volumes at low costs has made it an attractive platform for companies looking to streamline their operations and improve efficiency.
However, regulatory barriers to Solana adoption remain in some areas. The US Securities and Exchange Commission (SEC) is reluctant to approve a Solana-based ETF, with the approval probability currently estimated at just 3% according to industry analysts.
Solana Market Data
At the time of printing 17:51 UTC on September 20, 2024Solana is number 5 in terms of market capitalization and so is the price upwards 2.59% in the last 24 hours. Solana has a market capitalization of $69.09 billion with a 24-hour trading volume of $3.37 billion. More information about Solana ›
Summary of the crypto market
At the time of printing 17:51 UTC on September 20, 2024the total crypto market is valued at € $2.19 trillion with a 24-hour volume of $88.53 billion. Bitcoin’s dominance currently stands at 56.79%. Learn more about the crypto market ›