Ondo Tokenizes Franklin Templeton’s High-Yield ETF as FLHYon

Ondo Finance has tokenized Franklin Templeton’s Franklin High Yield Corporate ETF (FLHY) as FLHYon, giving digital-asset users economic exposure to a high-yield bond fund without direct ownership of its shares.

Ondo announced the tokenization of five Franklin Templeton ETFs on March 25, 2026. Franklin Templeton remains responsible for managing the underlying funds, while Ondo provides the tokenization and digital distribution infrastructure.

FLHY invests at least 80% of its net assets in high-yield corporate debt securities. The fund seeks current income and has a secondary goal of capital appreciation. It is listed on Cboe and pays dividends monthly.

The conventional ETF had $1.21 billion in net assets as of Oct. 5, 2026, and a net asset value of $23.41 as of Oct. 6, 2026. FLHYon is structured separately from the ETF and provides economic exposure to the fund, including reinvested distributions, rather than direct ownership or shareholder rights.

One FLHYon token represents 1.0257 FLHY shares. The issuer is Ondo Global Markets (BVI) Limited, and the tokens are designed to be backed by the underlying securities, additional collateral and cash in transit.

The tokenized product adds a high-yield ETF to Franklin Templeton’s existing tokenized money-market-fund activity. The firm’s Franklin OnChain U.S. Government Money Fund has also been used in digital-asset applications involving tokenized fund shares and trading collateral.

The structure gives holders exposure to a portfolio of U.S. high-yield corporate debt through a separate digital product rather than through direct ETF shares. That distinction means FLHYon holders do not receive the shareholder rights attached to conventional FLHY ownership.

FLHYon’s issuance extends tokenized fund products beyond government money-market strategies into corporate credit, while keeping the underlying ETF’s income-focused investment objective at the center of the product.