Jenny Johnson, the president and CEO of Franklin Templeton, a financial powerhouse managing $1.6 trillion in assets, reaffirmed her support for blockchain technology during an interview with Bloomberg anchor David Westland at the 27th Annual Milken Institute Global Conference in California. Among the various topics discussed, Johnson highlighted the significance of tokenization and generative artificial intelligence (AI) in the financial industry.

Regarding tokenization, Johnson expressed enthusiasm for blockchain technology, emphasizing its efficiency and potential to revolutionize investment opportunities. She shared how Franklin Templeton conducted a comparative experiment, processing account records using both traditional methods and blockchain technology. The results were notably positive, with blockchain proving to be significantly less costly. Johnson predicted a future where ETFs and mutual funds would operate on blockchain, citing the technology's ability to address the substantial costs associated with data verification across disparate systems.

Johnson stressed the importance of blockchain as a single source of truth, eliminating the need for extensive data verification between external parties once reconciled in-house. This streamlined process not only saves time and resources but also facilitates more diversified investment opportunities. Johnson referenced the example of pop superstar Rihanna releasing nonfungible tokens (NFTs) that granted owners royalties through smart contracts, illustrating blockchain's potential for innovative financial instruments.

Transitioning to the topic of generative AI, Johnson acknowledged its value while cautioning about its limitations. She likened it to a student excelling in one subject but struggling in another, emphasizing the need for careful consideration and oversight. Johnson highlighted Franklin Templeton's collaboration with Microsoft to develop an AI-powered sales assistant, showcasing the firm's investment in AI technologies. Additionally, she recognized the potential of AI-powered translation services to overcome language barriers in finance, further emphasizing the transformative role of AI in the industry.