Franklin Trust introduces Blockchain technology to monetize idle salary funds.

Source: Cointelegraph Original: "Franklin Trust Introduces Blockchain Technology to Generate Returns on Idle Salary Funds"

The hybrid cryptocurrency payroll service provider Franklin recently launched an innovative scheme aimed at converting idle payroll funds of enterprises into revenue opportunities. According to an exclusive statement provided by the company to Cointelegraph, this new service, named "Payroll Treasury Yield" ( Payroll Treasury Yield ), helps enterprises generate revenue from previously idle payroll funds through a blockchain lending protocol.

The program integrates the decentralized finance ( DeFi ) lending platform Summer.fi, allowing businesses to deposit stablecoin-denominated salary reserves into a smart contract-based lending pool. These funds will be lent to rigorously vetted borrowers, enabling businesses to earn returns while retaining the right to use their funds. Throughout the process, businesses maintain complete control over the custody of funds, and the smart contracts used have all undergone security audits to reduce risks.

Megan Knab, founder and CEO of Franklin, pointed out to Cointelegraph: "We are addressing dual pain points." For companies that have integrated cryptocurrencies into their balance sheets, Franklin helps them leverage these assets to optimize operations; "and for the broader market, we are empowering future business models—enabling smarter, more instantaneous, and more global capital flows," Knab added.

Alternatives to T-Bills

Franklin stated that its latest product is an alternative to traditional government bond instruments, such as automatic rollover accounts or Treasury bills (T-Bills), which typically involve operational complexity and limited returns.

In addition, this product is also different from the "Earned Wage Access (EWA)" platform, which allows employees to withdraw earned wages before payday, but often involves new debt and related costs.

Knab stated: "In the next decade, traditional payment methods will operate entirely on public blockchains as a batch alternative to ACH and SWIFT."

He added that if on-chain salary products become mainstream, banks may gradually fade from view. Although technology may replace many banking functions through self-custody tools and smart contracts, the regulatory framework will still require the existence of entities with legal responsibilities.

The final result may be "zombie institutions"—nominal banks that exist solely to meet compliance requirements but play almost no role in actual payment processing, Knab stated.

However, decentralized lending also comes with risks such as smart contract vulnerabilities and market volatility. Franklin stated that it aims to mitigate these risks by using audited contracts from Summer.fi and an over-collateralized lending mechanism.

The generation of yield strategies is increasingly gaining attention.

In recent years, there has been a significant increase in interest in yield generation strategies in the cryptocurrency space as retail and institutional investors seek to maximize returns on digital assets.

On May 16th, Solv Protocol launched a yield-generating Bitcoin token on the Avalanche blockchain, providing institutional investors with more yield opportunities linked to real-world assets (RWA).

On May 1, Ryan Chow, co-founder and CEO of Solv Protocol, stated that the demand for yield strategies surrounding Bitcoin is surging, especially from businesses looking to gain liquidity without liquidating their BTC.

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