Institutional Adoption of Crypto as Franklin Templeton Sees New Asset Era

• Sandy Kaul says investment portfolios seek frontier markets with big returns beyond hyper-fixation on Bitcoin.
• Franklin Templeton sees the crypto ecosystem as a collection of digital nation-states.
• Interest in crypto is shifting from retail to institutions, with leading organizations positioning themselves for a new asset era.

YouTuber Scott Melker recently posted a new YouTube video interview with Franklin Templeton’s Senior Vice President, Sandy Kaul. The video explores the development in the institutional adoption of crypto brought about by Franklin Templeton, one of the most significant asset managers in the world, with over $1.3 trillion under management.

According to Kaul, users are usually hyper-fixated on Bitcoin. Meanwhile, investment portfolios always look for “the next set of frontier markets,” which offer the most extensive potential returns.

We [Franklin Templeton] look at the crypto ecosystem as a set of digital nation-states. Each of these blockchain ecosystems is almost its own nation-state.

In regard to the challenges that the regulators pose to the narrative about diversified portfolios that Franklin Templeton is pushing, Kaul emphasizes that most regulators in the world, including the CFTC, don’t share the same attitude about crypto as the SEC. However, she expects the SEC to soon come to speed with crypto-supportive laws and regulations.

Meanwhile, Kaul adds that regulators across the Middle East, Hong Kong, Singapore, the UK, Irish, Brazil, and Europe are implementing comparatively advanced regulations. Hence, Franklin Templeton is curating crypto portfolios. However, they anticipate a longer time for them to get adopted.

Melker further questioned how the Polygon-based Franklin Templeton was able to secure the registration as a “digitally-native” product and if it has to do with the reputation and size of the company. In response, Kaul shared that they have been in talks with the SEC for the last five years, allowing the regulators to monitor the on-chain transactions better.

Additionally, Kaul points out that there has been a migration of interest from retail to institutions in terms of crypto as a “frontier risk marketplace.” Simultaneously, as per the Senior VP, leading institutions are leveraging crypto winter to position themselves in a “new asset era.”

Lastly, Kaul adds that any organization focused on long-term growth and sustainability needs to explore the crypto landscape, which she believes is already making progress. She highlights that although people may have anti-crypto sentiments, companies, including JP Morgan, cannot deny the sector’s business potential.