Jenny Johnson, the president and CEO of Franklin Templeton, a financial firm managing $1.6 trillion in assets, reiterated her support for blockchain technology during an interview with Bloomberg anchor David Westland at the 27th Annual Milken Institute Global Conference in California.
During the discussion, Johnson shared her thoughts on tokenization and generative artificial intelligence.
Tokenization
When asked about the benefits of tokenization for Franklin Templeton, Johnson expressed her admiration for blockchain technology. She explained that the company conducted an experiment comparing the processing of account records using traditional methods and blockchain over a period of six to eight months. The results were surprisingly positive, with Johnson stating, “We were amazed by how much cheaper it was to run it on blockchain.”
Johnson attributed this cost reduction to the significant expenses associated with verifying data across different systems, which blockchain solves. She also emphasized that financial institutions still need to verify data with external parties even after reconciling it internally.
According to Johnson, the time and cost savings from blockchain can lead to more diverse investment opportunities. She cited the example of pop superstar Rihanna, who released 300 nonfungible tokens that granted their owners a small percentage of royalties from one of her songs through a smart contract.
It’s worth noting that Johnson previously mentioned this example during an interview with CNBC’s Delivering Alpha in October 2023, where she described tokenization as “securitization done on steroids.”
Generative AI
The conversation then turned to generative artificial intelligence. Johnson acknowledged the value of generative AI systems but also highlighted their limitations. She compared it to a student who excels in English but struggles in math.
Johnson revealed that Franklin Templeton recently partnered with Microsoft to develop an AI-powered sales assistant. She also expressed optimism about investment opportunities in the AI space. Additionally, she praised the potential of AI-powered translation services to overcome language barriers in finance.
In conclusion, Johnson’s interview covered the benefits of tokenization, particularly in terms of cost reduction and diversified investment opportunities. She also discussed the potential of generative AI and its partnership with Microsoft for the development of an AI-powered sales assistant.