Jenny Johnson, CEO of Franklin Templeton, one of the world's largest asset managers, spoke at CNBC's Delivering Alpha event to discuss how digital assets are disrupting securitization and financial markets. She believes that tokenization is "securitization on steroids" and is leading the market to undergo a huge change.

The largest player in the tokenized U.S. Treasury market mentioned the core technology of blockchain

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 is an asset management company with an asset scale of US$1.5 trillion. Franklin OnChain U.S. Government Money Fund FOBXX is the largest player in the tokenized U.S. Treasury market. It has also recently filed an application with the SEC for a spot Bitcoin ETF.

Tokenisation will change the structure of all assets in next decade

I’ve been saying this for a while now & have written about it in many of my posts. This week, Franklin Templeton CEO, Jenny Johnson, made the following comments in her panel at CNBC’s “Delivering Alpha” event… pic.twitter.com/MKuZ7TtBrG

— Finance Allrounder (ranav) (@finallrounder) October 1, 2023

Johnson analyzed the future of alternative investment vehicles as part of the conversation. She noted that available capital and technological disruption have attracted more companies and CEOs to invest in "future-proof things" such as blockchain technology. Because blockchain technology has the following core technologies:

  • Allow payment mechanism

  • Allows smart contracts to be programmed into tokens

  • Because it is a general ledger and has a source of facts. Therefore, regardless of who owns the token, all rights to the token are vested in that person

“Securitization on steroids” will subvert traditional business models

Johnson used singer Rihanna as an example to illustrate her point. In February, Rihanna released a popular song as an NFT, allowing holders to earn a portion of royalties through streaming.

I know she was just testing the market with these 300 NFTs. When Spotify plays a Rihanna song, the technology can pay a portion of the royalties to loyal fans based on a smart contract, without anyone having to do the math.

According to previous reports from CoinDesk, Rihanna’s NFTs sold for $210 each and were sold out within minutes of going on sale. Each holder will receive "a portion of 0.0033% of the streaming royalties" for the song. Holders will receive an initial royalty payment, followed by payments every six months based on streaming revenue. According to AnotherBlock, the current floor price of this NFT is 0.29 ETH (approximately $500).

Johnson also mentioned that athletes could use the technology to sign contracts. They can sell tokens for future revenue streams, for which fans may pay a premium.

Johnson refers to it’s just securitization done on steroids, a term often used to describe something that exceeds expectations. And blockchain technology will make that possible, and it will also make possible other interesting companies that Johnson expects will disrupt some of the traditional business models we have today.

This article Franklin CEO: Tokenization is “securitization on steroids” and is leading the market to undergo a huge change. First appeared on Chain News ABMedia.