Franklin Templeton CEO says Bitcoin investment still in early phase

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Franklin Templeton CEO Jenny Johnson believes we are still in the early days of the Bitcoin (BTC) investment cycle, and that big institutional money has not yet been fully deployed into the asset class.

“This is really the first wave of the early adopters, and I think the next wave is the much bigger institutions,” Johnson told CNBC in a recent interview.

The CEO noted that institutional interest will continue to grow as previously apprehensive investors and fund managers become more comfortable with handling digital assets and their underlying technologies.

Weekly asset flows into crypto funds for the week ending May 31, 2024. Source: CoinShares Digital Asset Fund Flows report

Johnson is an outspoken believer in blockchain innovation. The CEO of the $1.6 trillion asset management firm previously said she believes all exchange-traded funds and mutual funds will one day exist on the blockchain.

Johnson cited significantly lower data processing costs and novel use cases as the main drivers behind her endorsement of blockchain technologies and digital assets.

Johnson said her firm conducted an experiment to test traditional data processing systems against blockchain information systems; her team was “astonished” at the drastic cost reduction inherent in using blockchain systems to transmit data.

Novel use cases for digital assets are also on Johnson’s radar. She highlighted Rihanna’s use of nonfungible tokens to tokenize royalty rights to her song “B*tch Better Have My Money” and pass those rights on to holders of the NFTs.

Related: Be persistent with the SEC, says Franklin Templeton digital asset head.

Such use cases prompted Johnson to characterize tokenization as “securitization done on steroids,” noting the power digital assets have to open up previously inaccessible liquidity and unlock value hidden deep within hard assets and digital property rights.

Such technologies can also increase access to non-financial assets, like collectibles, memberships to various organizations via NFTs and other tokens, and subscriptions—potentially creating new asset classes and markets altogether.

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