Jenny Johnson, CEO of Franklin Templeton, one of the world’s largest asset managers, believes that securitization, a practice with more than 50 years of history, is undergoing a huge transformation.
During CNBC’s Delivering Alpha event, Johnson famous Tokenization — the process of converting ownership of an asset into digital tokens on the blockchain — is similar to “securitization on steroids,” a term often used to describe something that exceeds expectations.
Johnson’s comments were part of an analysis of the future of alternative investment vehicles. The executive noted that available capital and technology disruption have attracted more companies and CEOs to invest in “future-proof things” like blockchain technology. Johnson said:
“One is that it allows for payment mechanisms. Second, it allows smart contracts to be programmed into the token. Third, because it is a ledger, it has a source of truth. So no matter who owns the token, all of the Rights are vested in that person.”
Johnson used Rihanna as an example to illustrate her point. In February, the singer released a popular song in the form of a non-fungible token (NFT), allowing holders to earn a portion of royalties through streaming. “My favorite example is Rihanna,” she said of the NFT line that launched ahead of the Super Bowl.
“I know she’s just testing the market with these 300 NFTs […]. So why is she allowed to do this? She can do this because when Spotify plays a Rihanna song, it can capture the smart contract, execute it and say, “I owe royalties here, so no one needs to be involved in this.” It can hand over part of the payment to Rihanna Big fan of Frank. ”
Johnson said athletes could also benefit from tokenization:
“think [about] Athletes will sign a big contract. They’ll say to their fans ‘I’m going to sell tokens worth 10% of my future income stream. I will sell 100,000 tokens and fans will likely pay a premium for it. So that would be one way, if you think about it, it’s just securitization done on steroids. “
1/ The future is tokenized culture
Franklin Templeton’s Jenny Johnson shines on CNBC’s “Delivering Alpha.”
– Tokenization = Securitization on steroids
– Tokenize cultural intellectual property through NFT royalty streams.
Rhianna is creating a modern-day ‘Bowie bond’ for fans so they can… pic.twitter.com/Vrfqyne7SM
— Ram Ahluwalia, CFA The longer the crypto, the higher the price (@ramahluwalia) September 30, 2023
Johnson has been with Franklin Templeton for more than 30 years and currently serves as President and Chief Executive Officer of the company’s executive leadership team. Franklin, an asset management firm with $1.5 trillion in assets and offices around the world, is among the companies waiting for U.S. regulators to approve a spot Bitcoin exchange-traded fund (ETF).
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