Jenny Johnson, CEO of $1.6 trillion asset management firm Franklin Templeton, said in an interview with Bloomberg anchor David Westin that she remains a big fan of blockchain technology. He said he sees exchange-traded funds (ETFs) and investment trusts on the blockchain.
Ms. Johnson is the granddaughter of Franklin Templeton founder Rupert Harris Johnson, who joined the firm in 1988 and is one of the most influential women in the financial industry.
Johnson said in an interview that a “substantial portion” of Franklin Templeton’s business is held in mutual funds, with about $900 billion of its $1.6 trillion in assets and $78 billion in private credit held there. He said there was. She has been speaking on the topic of innovation in blockchain technology for many years.
“We were surprised at how low-cost it is to run on blockchain. We think this is a very efficient technology and will open up many new investment opportunities, and honestly I think ultimately all ETFs and mutual funds will be on the blockchain,” Johnson said.
So how do tokenized ETFs work?
In a recent column, ETF.com research analyst Kent Tune explains that tokenized ETFs, also known as security token ETFs, combine the structure of an ETF with the benefits of blockchain technology. .
“Tokenized ETFs tokenize the underlying assets of the ETF. These tokenized representations reside on the blockchain, which is a secure and transparent digital ledger. Rather than holding ETF shares, you will hold digital tokens that represent ownership of the ETF,” Thun wrote.
Wall Street and Tokenization
Benzinga reports that there is strong pressure among Wall Street firms to ramp up efforts to tokenize assets on blockchains. Tokenization is the conversion of tangible and intangible assets into digital tokens. Everything from stocks and bonds to gold bullion, real estate, and even digital and physical art can be converted into digital tokens.
In March 2023, BlackRock CEO Larry Fink stated in his annual letter to shareholders that some of the fundamental technologies in the digital asset space have operational potential for exciting applications. I commented that it was sexual. Tokenization of asset classes “offers the prospect of increasing the efficiency of capital markets, shortening the value chain, and improving cost and access for investors,” Fink said.
