Jenny Johnson, the CEO of Franklin Templeton, one of the world's largest asset managers, believes that securitization is undergoing a dramatic transformation through tokenization. This process involves converting asset ownership rights into digital tokens on a blockchain, and Johnson describes it as "securitization done on steroids."
The Future of Alternative Investment Vehicles
During CNBC's Delivering Alpha event, Johnson discussed the future of alternative investment vehicles and highlighted how capital and technology disruption are attracting companies and CEOs to invest in blockchain technology. She explained that tokenization offers several advantages:
- It allows for a payment mechanism.
- It enables smart contracts to be programmed into the token.
- It provides a general ledger as a source of truth.
Johnson used Rihanna's recent nonfungible token (NFT) collection as an example to illustrate her point. By releasing one of her popular songs as an NFT, Rihanna allowed holders to partially earn royalties on streaming. Johnson emphasized that athletes can also benefit from tokenization:
"Think about athletes who sign a big contract. They can sell off tokens worth 10% of their future revenue stream. For example, they could sell 100,000 tokens to their fans, who would likely pay a premium for them. This is essentially securitization done on steroids."
Jenny Johnson and Franklin Templeton
Jenny Johnson has been with Franklin Templeton for over 30 years and currently serves as its president and CEO. Franklin Templeton is a $1.5 trillion asset manager with offices worldwide. The company is awaiting regulatory approval in the United States for a spot Bitcoin exchange-traded fund (ETF).
