Blockchain
Jenny Johnson of Franklin Templeton on Bitcoin ETFs, RWA tokenization and the potential of Blockchain for TradFi
AUSTIN, TX — Franklin Templeton, the $1.6 trillion asset manager based in Silicon Valley, has been at the forefront of traditional finance heavyweights pushing into the digital asset space.
“We looked at blockchain technology [and found] this is going to be transformational and we better make sure we understand that,” said Jenny Johnson, president and CEO of Franklin Templeton, during a panel discussion Thursday at Consensus 2024 in Austin.
That’s why the company operates around 30 validation nodes on 12 different blockchains, for example on Ethereum (ETH)Cardan (ADA)Stellar (XLM) and Provenance, Johnson said on the panel. This is more than that of the asset manager website show, which mentions six networks that include the same four blockchains plus Polkadot (POINT) and Solana (SOL).
A key aspect of blockchain technology, he explained, is the efficiency in recording and reconciling transactions and its cost-saving potential.
“Franklin [Templeton] today there are a huge number of people, a couple of hundred, who simply reconcile [data] between systems, then we have to reconcile with our counterpart and another company,” Johnson said.
Blockchains offer a single “source of truth” and record transaction times better than conventional processes, he said, which could help reduce costs and reduce administrative workload.
“We are in an industry where we are constantly under pressure to reduce the cost of delivering what we do,” he added.
One example that benefits from blockchain is tokenization, which makes real-world assets like funds and bonds available on digital asset rails. Franklin Templeton was a pioneer, he said, launching the first money market fund available on-chain using the Stellar network in 2021, years before rivals such as BlackRock entered the industry.
Franklin Templeton was one of 11 issuers approved to list spot bitcoin exchange-traded funds in the United States in January, and is also among those awaiting approval to launch a similar vehicle for the second-largest cryptocurrency Ether.
Johnson said many people are attracted to bitcoin (BTC) as assets outside the banking system resistant to government seizure, but ETFs offer a well-known vehicle for gaining exposure.
“To me it’s a vehicle of choice,” Johnson said. “An ETF is a regulated entity, which puts many people at ease who might not otherwise transact in this space.”