Franklin Templeton’s high yield corporate bond ETF, FLHY, now trades on Pendle in tokenized form as FLHYon. The Pendle market carries a 2026 maturity date.
What FLHYon actually is
FLHYon is a token that tracks Franklin Templeton’s FLHY ETF. It was built through Franklin Templeton’s collaboration with Ondo Finance.
The issuer is Ondo Global Markets (BVI) Limited. Ondo holds the underlying assets, and the structure is designed to keep the tokens backed 1:1, alongside cash held in transit for liquidity.
Holders do not own FLHY shares directly. They get economic exposure to the ETF, and that exposure includes dividend reinvestments.
FLHYon had roughly $24.17 in net asset value per token as of early to mid October 2026, with a circulating supply of approximately 20,558 tokens. On-chain assets came to approximately $497,000 as of October 2026.
Where Pendle fits in
Pendle specializes in yield tokenization, letting traders deal in an asset’s future income stream as its own tradable thing, with a defined end date. For the FLHYon market, that maturity falls in 2026.
Pendle is not the issuer and has no direct link to the token’s structure. Ondo issues FLHYon and holds the backing assets, while Pendle hosts a market built on top of it.
The rails underneath
FLHYon lives primarily on Ethereum. Minting and redemption run 24/5, mirroring conventional market hours. Peer-to-peer transfers run 24/7.
Morpho, a lending platform, accepted FLHYon as collateral as of June 2026, using Chainlink oracles for pricing data.
Background: Franklin Templeton and Ondo
Franklin Templeton’s strategic partnership with Ondo was established in March 2026 and covers the tokenization of five ETFs: FLHY, FFOG, FLQL, FGDL and INCE. The launch window for FLHYon ran between mid-2025 and March 2026.
The offerings target both US and non-US investors through an offshore issuing entity.
What this means
The risks include credit risk inherent to high yield bonds, issuer risk at Ondo, oracle risk from price feeds, and smart contract risk at every protocol the token touches. Holders get economic exposure, not shares, so their claim runs through Ondo’s structure rather than straight to the ETF.
With approximately $497,000 on-chain, the token’s footprint is small, and thin markets can make large trades costly on yield venues like Pendle.
Disclosure: This article was edited by Kaye Quema. For more information on how we create and review content, see our Editorial Policy.