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Franklin Templeton Making It Rain DeFi Yields Sandy Kaul INTERVIEW · The Paul Barron Crypto Show

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Speaker 1: All right, so welcome into the show. Today we're going
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Speaker 1: to be diving into Franklin Templeton a little bit of
0:04
Speaker 1: where they're going. You guys don't want to miss this one.
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Speaker 1: My name is Paul Barrel. Welcome back into the show.
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Speaker 1: Let's do thank our sponsor, and that is Coinbase, a
0:11
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0:13
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0:23
Speaker 1: of course use our link. It does help the channel,
0:25
Speaker 1: so we always appreciate that. I want to get into
0:28
Speaker 1: it today. We've got an executive from Franklin Templeton joining
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Speaker 1: us here in a minute, but I want to kind
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Speaker 1: of focus on a couple of things. Of course, as
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Speaker 1: you guys know, we've been tracking this space for quite
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Speaker 1: some time. But when you look at token is is
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Speaker 1: money markets. Franklin Templeton has been at this all the
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Speaker 1: way back into twenty twenty one, so they are definitely
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Speaker 1: one of the ogs in the space.
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Speaker 2: And if you look at them on.
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Speaker 1: The RBA list, you've got securitized in there, but right
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Speaker 1: there Franklin Templeton holding the number six position. Hopefully this
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Speaker 1: will continue to grow for them, so it's a good
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Speaker 1: thing to get one one of their executives in on
1:01
Speaker 1: the show and ask them some questions. I want to
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Speaker 1: introduce Sandy Call, who's the VP and head of innovation
1:06
Speaker 1: joining us today.
1:07
Speaker 2: How are you great?
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Speaker 3: Thank you so much for having me. Happy to be here.
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Speaker 2: With you, Sandy.
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Speaker 1: I've watched several of your interviews. I love the fact
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Speaker 1: that you're so on top of this, so kudos to you.
1:16
Speaker 2: I want to get.
1:17
Speaker 1: Into a couple of things I'm looking over at Benji Institutional,
1:22
Speaker 1: and then you can also go into the Benji app,
1:25
Speaker 1: which is, in my opinion, a really really good and
1:29
Speaker 1: well designed product.
1:31
Speaker 2: Here. Who are the customers for Benji? What are they?
1:34
Speaker 2: Who are they?
1:35
Speaker 3: We've actually designed our Benji product suite to service all customers.
1:40
Speaker 3: So we have an institutional version of Benji that's targeted
1:44
Speaker 3: at hedge funds and advanced trading firms that are really
1:47
Speaker 3: looking to utilize sophisticated investment strategies with derivatives and perpetuals,
1:53
Speaker 3: and who need a good substitute for stable coins in
1:56
Speaker 3: their collateral postings. With a token I this money market fund,
2:00
Speaker 3: you actually get a haircut on your overall collaboral requirements
2:04
Speaker 3: and it works better for you in terms of keeping
2:07
Speaker 3: that yield that comes along with the money market fund,
2:09
Speaker 3: So that's targeted at an institutional audience. We also have
2:14
Speaker 3: released a forty act, a mutual fund version of our
2:18
Speaker 3: tokenized money market fund, where the minimum buy in size
2:21
Speaker 3: is only twenty dollars, and this is very much targeted
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Speaker 3: at individuals, and that is what the app is targeted
2:27
Speaker 3: at as well. And we're really, i think the only
2:30
Speaker 3: retail tokenized money market fund that's out there offering this
2:34
Speaker 3: type of capability to every day investors.
2:37
Speaker 1: Have you seen a large uptake in terms of people
2:40
Speaker 1: that are coming into this for the first time and
2:42
Speaker 1: understanding what a tokenized money market fund is.
2:46
Speaker 3: Yeah, we're starting to really see a pickup and interest,
2:49
Speaker 3: and we're starting to get a real, i think broadening
2:54
Speaker 3: understanding of how money market funds work together with stable coins.
2:59
Speaker 3: In this thinking of stable coins as almost your cash
3:02
Speaker 3: account and money market funds as your savings account, and
3:06
Speaker 3: being able to move seamlessly between the two in a
3:09
Speaker 3: wallet based ecosystem. So we're starting to get a lot
3:12
Speaker 3: of interest from that quarter, particularly since we are the
3:15
Speaker 3: only tokenized money market fund globally that is digitally issued
3:20
Speaker 3: native on chain, which means that there is no off
3:23
Speaker 3: chain exposure. The token is the exposure to the fund,
3:27
Speaker 3: and therefore you can really use it in very different ways.
3:30
Speaker 3: You can transfer it peer to peer, you can have
3:34
Speaker 3: automic settlement on this, and it allows us to offer
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Speaker 3: new types of functionality around the token that other money
3:40
Speaker 3: market funds just can't offer.
3:42
Speaker 1: At this point, we definitely want to get into that
3:44
Speaker 1: in a second. I want to talk about intra day
3:47
Speaker 1: real quickly, because this seems like a huge selling point.
3:50
Speaker 1: I'm just looking at some of the performance here right now.
3:53
Speaker 1: Has this been a successful selling point for you guys.
3:57
Speaker 3: Yeah, so we just released this functionality, and yes, it
4:00
Speaker 3: is so new. I think people are just starting to
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Speaker 3: understand how impactful it truly is. We're seeing more interest,
4:07
Speaker 3: i think, initially from institutional investors who have worked with
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Speaker 3: money market funds pretty much for decades and who understand
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Speaker 3: the difference between getting inter day yield versus having have
4:19
Speaker 3: to hold the positions through the close of a day
4:22
Speaker 3: to qualify for yield and who are really appreciating the
4:26
Speaker 3: ability to get yield paid out every single calendar day,
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Speaker 3: including Saturdays, Sundays, and holidays, instead of waiting for an
4:33
Speaker 3: end of month to get that yield payout. I think
4:37
Speaker 3: for retail investors, this is a new concept, right. They
4:40
Speaker 3: aren't used to getting yield every day in any account.
4:44
Speaker 3: There's no banking product that offers that. There's no investment
4:47
Speaker 3: product that offers that. So I think this is a
4:49
Speaker 3: very unique offering that's starting to get understood. But I
4:54
Speaker 3: truly believe as we get the word out more, as
4:56
Speaker 3: we're able to demonstrate and connect into more venues with
4:59
Speaker 3: this offering, it will become very popular because people deserve
5:03
Speaker 3: their money each day. If it's their money, right, nobody
5:05
Speaker 3: else should be holding it and getting the benefit of
5:07
Speaker 3: it exactly.
5:09
Speaker 2: Well.
5:09
Speaker 1: One of the things we're tracking quite a bit is
5:11
Speaker 1: the speed in which these yields are being determined. Do
5:14
Speaker 1: you foresee a future where you might even get into
5:18
Speaker 1: streaming yields where it's literally coming to you by the minute.
5:23
Speaker 2: What does that look like? Absolutely? Could?
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Speaker 3: Yeah. I think that that is the beauty of having
5:29
Speaker 3: these native token exposures and operating our entire shareholder record
5:33
Speaker 3: entirely on blockchain is that we can operate at the
5:37
Speaker 3: speed of the chains themselves, so we can really do
5:41
Speaker 3: that type of on demand processing. We could stream it.
5:45
Speaker 3: I think these are going to become commonplace functions over
5:49
Speaker 3: the next five years. We're just very early to market
5:51
Speaker 3: with it and helping to set the benchmark.
5:54
Speaker 1: What do you think about costs, because this is one
5:56
Speaker 1: of the challenges. I think that especially young investors coming
5:59
Speaker 1: into the market, they always talk to me about I
6:02
Speaker 1: hate using this platform. The rates and fees are too high.
6:05
Speaker 1: You look at on chain fees versus traditional finance, there's
6:09
Speaker 1: a big difference there. You guys, of course, are kind
6:11
Speaker 1: of hybrid in this approach here. How are you guys
6:15
Speaker 1: addressing that right now?
6:16
Speaker 3: Yeah, So we only charge a management fee on the fund.
6:19
Speaker 3: There is no fee for processing, there's no fee for buying,
6:22
Speaker 3: there's no fee for selling, there's no fee for transfers.
6:25
Speaker 3: You just pay the standard management fund management fee on
6:30
Speaker 3: the fund itself, which you would be doing on any
6:33
Speaker 3: real fund vehicle, and there's no hitting costs and the
6:37
Speaker 3: cost savings gets passed along. The cost savings that we
6:40
Speaker 3: realize by running this on blockchain gets passed along in
6:44
Speaker 3: a lower cost basis to the underlying investor. So one
6:48
Speaker 3: of the things they'd never tell you when you buy
6:50
Speaker 3: investment funds is that they deduct some of those costs
6:53
Speaker 3: from your returns. Because we're operating on blockchain, we're able
6:56
Speaker 3: to deduct a lower cost, We're able to operate with
7:00
Speaker 3: the lower cost, and therefore we're able to pass on
7:02
Speaker 3: more of the actual yield that you earn to you
7:05
Speaker 3: as the underlying investor. So there's even less fees on
7:09
Speaker 3: these tokenized products because we're getting the benefit of operating
7:12
Speaker 3: on blockchain and passing that through to our clients.
7:15
Speaker 1: Would you say that that cost savings is significant?
7:19
Speaker 2: Is it just an edge? What is kind of the position?
7:22
Speaker 1: Is this something big enough that it would restructure how
7:24
Speaker 1: markets would act in the future.
7:28
Speaker 3: I think when you look at it from the Franklin
7:30
Speaker 3: Templeton perspective or from the perspective of say a corporate treasurer,
7:34
Speaker 3: this will absolutely restructure how markets work. But when you're
7:38
Speaker 3: dealing in small amounts of money, the size of the
7:42
Speaker 3: savings is pretty minimal. But it still adds up. Right,
7:45
Speaker 3: Everyone likes getting back whatever they can but when you're
7:48
Speaker 3: starting to deal with you know, hundreds of thousands of
7:51
Speaker 3: transactions and hundreds of millions of dollars in transactions, these
7:55
Speaker 3: savings are appreciative, and we do think that it is
7:58
Speaker 3: going to change the way the whole market infrastructure works,
8:01
Speaker 3: that these rails are going to take over and we're
8:03
Speaker 3: going to see all financial services move into this wallet
8:06
Speaker 3: based ecosystem.
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Speaker 1: You know, it's interesting that you say that because I'm
8:10
Speaker 1: getting a lot more inbound inquiries from you know, money
8:15
Speaker 1: managers just in general. They've never been exposed to the
8:18
Speaker 1: digital space before. Digital assets is a brand new thing
8:21
Speaker 1: to a lot of their clients, and they're starting to
8:24
Speaker 1: you know, they discover our channel, so they're always asking
8:26
Speaker 1: who's out there. And I've talked to many people who
8:28
Speaker 1: just are not doing digital assets. So it seems like
8:30
Speaker 1: you guys are in the right place at the right
8:32
Speaker 1: time when you look at the different levels of blockchains,
8:35
Speaker 1: because I know you guys have different investment tiers and
8:40
Speaker 1: in some cases it's by the blockchain. I'm just looking
8:42
Speaker 1: at your RWA here as an example of Stellar kind
8:45
Speaker 1: of leading the way here. But what has been the
8:48
Speaker 1: blockchain that has been serving you guys the best thus far.
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Speaker 3: So we built the system originally on Stellar, which is
8:56
Speaker 3: why we are very deeply embedded with that ecosystem, and
9:00
Speaker 3: they are very good from a cost perspective in terms
9:04
Speaker 3: of being able to handle a lot of volume, particularly
9:07
Speaker 3: smaller orders where you want to keep the costs as
9:10
Speaker 3: low as possible. What we have found is we have
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Speaker 3: a whole kind of blockchain selection mechanism that we use
9:18
Speaker 3: internally based on who the client is placing the order,
9:22
Speaker 3: the size of the order, how long we think the
9:25
Speaker 3: duration of the trade is going to be held, and
9:27
Speaker 3: that kind of dictates which blockchain we go to because
9:31
Speaker 3: the cost structures, the minimums are very different and the
9:34
Speaker 3: way that they handle the record keeping is oftentimes very different.
9:38
Speaker 3: So we have to have a whole strategy around that,
9:40
Speaker 3: and that is something we have developed through our own
9:43
Speaker 3: trial and error and really being able to operate across
9:46
Speaker 3: all these chains.
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Speaker 1: Do you feel though that I think it was like
9:50
Speaker 1: fifty K or something that was the level for Stellar.
9:53
Speaker 1: Do you feel like that is driving the interest level
9:56
Speaker 1: based on blockchain because of the requirements that you have
10:00
Speaker 1: to hit for certain networks, and is there any plan
10:03
Speaker 1: to change those in the future.
10:05
Speaker 3: Yeah, I think that as we see volumes grow, we'll
10:07
Speaker 3: be able to bring down all of those minimums. But
10:10
Speaker 3: I think that for now, what we're finding is we're
10:13
Speaker 3: more interested in extending across the different chains and creating
10:16
Speaker 3: that interconnectivity, and then we're just working with each chain
10:20
Speaker 3: where that chain is at the time to figure out
10:23
Speaker 3: the best way of operating with them. So we believe
10:26
Speaker 3: that there's going to be a multichain future. We think
10:28
Speaker 3: that having that connectivity across the chains is going to
10:31
Speaker 3: be an important differentiator. This is why we also run
10:34
Speaker 3: our own nodes across as many of the chains we
10:36
Speaker 3: operate on as possible, because we think that's part of
10:39
Speaker 3: our due diligence in being a member of this network.
10:43
Speaker 3: So right now, because it's so early in the development,
10:46
Speaker 3: we're focused more on making sure we're in the right ecosystems,
10:49
Speaker 3: and then over time, we trust that the economics will
10:52
Speaker 3: just get better and better for our customers and for
10:55
Speaker 3: ourselves as the system matures.
10:57
Speaker 1: When you look at you know, we get a lot
10:58
Speaker 1: of people they love our yield videos when we talk
11:01
Speaker 1: about stable coin yield, and you know the places to
11:03
Speaker 1: get that. You look at money markets now paying a
11:06
Speaker 1: significant amount of yield as well. You also look at
11:09
Speaker 1: the delay from a regulation standpoint of the Current Market
11:13
Speaker 1: Structure Act, and if that slows down, it's probably going
11:17
Speaker 1: to have an effect on money markets and also on
11:20
Speaker 1: stable coins to a certain extent.
11:22
Speaker 2: Is that something that is affecting.
11:24
Speaker 1: You guys right now the way that regulation is being
11:27
Speaker 1: kind of run through DC.
11:29
Speaker 3: Yeah, Well, we have been able to make tremendous strides
11:33
Speaker 3: in our infrastructure, even during the Biden administration, when you know,
11:37
Speaker 3: it was much tougher to get regulators on board with
11:40
Speaker 3: some of the innovations we were trying to push through.
11:42
Speaker 3: So there's been a noticeable uptick in the receptivity to
11:47
Speaker 3: our points of view. We've been actively engaged in dialogue
11:51
Speaker 3: with the regulators and really understanding our real life experience
11:55
Speaker 3: on these chains and some of the learnings that we've
11:58
Speaker 3: had through operating this environment for multiple years now. I
12:02
Speaker 3: mean we've been running our tokenized money Market Fund twenty
12:05
Speaker 3: four seven three sixty five for almost four years now
12:08
Speaker 3: at this point, So I think that we've been very
12:11
Speaker 3: engaged and find a good attitude from their regulators. I
12:15
Speaker 3: think what's happening is is that because we are more ahead.
12:18
Speaker 3: Sometimes we're able to get exceptions and no action letters
12:23
Speaker 3: to be able to do things maybe a little ahead
12:25
Speaker 3: of the rules themselves coming into focus for the whole industry.
12:30
Speaker 3: But you know, the ground that we're breaking is going
12:33
Speaker 3: to open up this opportunity for more and more of
12:35
Speaker 3: our peers as well over time, and we understand that
12:38
Speaker 3: and look forward to having a more robust ecosystem to
12:41
Speaker 3: compete within. So you know, we know we're early, but
12:44
Speaker 3: you know, we're also very excited about being able to
12:47
Speaker 3: have this most influence and really be able to share
12:50
Speaker 3: our learnings with the regular rules.
12:52
Speaker 1: If you look at yields in general and you kind
12:54
Speaker 1: of compare this to current interest rates, most likely if
12:57
Speaker 1: we get a rate cut, yields are going to start
12:58
Speaker 1: to slide slightly. What kind of impact if we start
13:02
Speaker 1: to see a near maybe if President Trump gets his
13:06
Speaker 1: way a one person interest rate out there in the markets,
13:09
Speaker 1: how would that affect what you guys are doing, especially
13:11
Speaker 1: around the money markets.
13:12
Speaker 3: Yeah, well, the money markets are a product where you know,
13:15
Speaker 3: when we first came out with this product and we
13:17
Speaker 3: were starting to experiment on blockchain, yields were zero. So
13:21
Speaker 3: we've seen yields go all the way from zero to highs,
13:23
Speaker 3: and we do expect money market yields to always fluctuate.
13:27
Speaker 3: You know, money markets were what I would call is
13:30
Speaker 3: our test product for tokenization, and what you'll be seeing
13:34
Speaker 3: from us in the coming year is really the expansion
13:37
Speaker 3: of our product suite. We can issue our forty act
13:40
Speaker 3: mutual funds here in the US, we can issue usage
13:43
Speaker 3: funds on chain in Europe and in Asia and in
13:48
Speaker 3: South America and the Middle East, and we can issue
13:51
Speaker 3: private funds. So you know, having built those core capabilities,
13:54
Speaker 3: we're now going to start to expand our product suite
13:58
Speaker 3: and really be able to have a full suite of offering.
14:01
Speaker 3: So if yields go down, that increases opportunities in other
14:05
Speaker 3: parts of the capital structure, and that's where we want
14:08
Speaker 3: to be prepared to offer product to our clients.
14:10
Speaker 1: Well, one of the things that you guys are doing,
14:12
Speaker 1: which I think is brilliant, and that is self custody.
14:15
Speaker 1: And I was looking at a tweet you had read
14:17
Speaker 1: here just feels better have your own assets and your
14:19
Speaker 1: own wallet. Benji now the technology platform allowing you guys
14:24
Speaker 1: to do this. When you look at self custody when
14:27
Speaker 1: will we be able to see accessing things like DeFi yields,
14:31
Speaker 1: et cetera on self custody.
14:32
Speaker 2: What is there any plan in the roadmap for that?
14:35
Speaker 3: Yeah, I mean we're waiting for a little bit of
14:37
Speaker 3: clarity here from the regulators on how to treat a
14:40
Speaker 3: regulated product within these DeFi protocols. We're probably going to
14:45
Speaker 3: be able to launch in what people are calling the
14:48
Speaker 3: c FI pools or the set you know, the more
14:50
Speaker 3: centralized pools where there is ky c a mL, and
14:54
Speaker 3: that will set the standard I think for how we've
14:57
Speaker 3: introduce these new capabilities into the world wilet based ecosystem.
15:01
Speaker 3: But we do anticipate over time being able to incorporate
15:05
Speaker 3: these products into DeFi as well, and I think that
15:08
Speaker 3: that will be an important leap to be able to
15:11
Speaker 3: get into some permissionless pools. Because these tokens, once issued,
15:16
Speaker 3: we're able to tie them back to the actual token holder,
15:20
Speaker 3: and if that KYCAML this has been done on the
15:22
Speaker 3: token holder, I think there's a good case to be
15:25
Speaker 3: made by encapsulating that in a token. You know, we
15:30
Speaker 3: are maintaining control of the asset, and even if that
15:34
Speaker 3: DeFi token recirculates, we still be able to unwrap that
15:38
Speaker 3: and only give the actual underlying instruments to the registered
15:42
Speaker 3: kycaml holder.
15:44
Speaker 2: Yeah, all right, that makes sense.
15:45
Speaker 1: What about the DeFi integrations that would be coming, because
15:49
Speaker 1: it's likely that we're going to see some pretty amazing
15:52
Speaker 1: products out there. A lot of DeFi platforms are starting
15:55
Speaker 1: to really accelerate in a big way, So there's a
15:57
Speaker 1: lot of people already understanding how to utilize is it.
16:00
Speaker 1: What kind of integrations do you guys come have coming
16:03
Speaker 1: down the pipe?
16:05
Speaker 3: Yeah, well, one of the things we're looking at right
16:06
Speaker 3: now is how people are using vaults and how they're
16:09
Speaker 3: doing some of these looping strategies. We think that's super interesting,
16:13
Speaker 3: and you know, because we can supply many of these
16:16
Speaker 3: underlying products that would go into the vault and help
16:19
Speaker 3: to support that strategy, and we run our own transfer agent.
16:22
Speaker 3: You know, right now, some of the fees being charged
16:24
Speaker 3: by those who are administering the looping strategies are quite high,
16:29
Speaker 3: and we think that there's an opportunity there for us
16:31
Speaker 3: to step in and offer a product at a better
16:34
Speaker 3: cost structure for the underlying investor. So that's something we're investigating.
16:38
Speaker 3: You know, as a regulated entity, we always have to
16:41
Speaker 3: run this by our internal and external council to make
16:44
Speaker 3: sure everybody's good with our plans. But those plans are
16:47
Speaker 3: on the drawing board right now.
16:49
Speaker 1: You're kind of skipping ahead on my questions here. It's like,
16:51
Speaker 1: you know what I'm getting ready to ask, Sandy. So,
16:56
Speaker 1: first of all, this was to your point right here
16:59
Speaker 1: is and you look at vaults in general, this is
17:01
Speaker 1: kind of a new concept that we've covered a little
17:04
Speaker 1: bit here on the show, but yields via automated vaults.
17:07
Speaker 1: This is something you are looking into as a trend
17:10
Speaker 1: that's already happening out there. Where would you put this
17:13
Speaker 1: on the list of most important? Is this something that
17:17
Speaker 1: is like up at the edge right now?
17:19
Speaker 2: Yeah?
17:19
Speaker 3: I would say, you know, right now we're focused on
17:22
Speaker 3: expanding our product range and really embedding some of these
17:27
Speaker 3: new i think market leading capabilities in the infrastructure and
17:31
Speaker 3: expanding those out across chains. Right We've launched these on
17:35
Speaker 3: some chains, and that's i'd say top of our list.
17:37
Speaker 3: I think that then you know this really this is
17:40
Speaker 3: what I always put on our we call it our
17:43
Speaker 3: R and D list, where we're really interested in these
17:46
Speaker 3: new structures and understanding how we might apply them, and
17:49
Speaker 3: getting the right legal and regulatory opinions on how to
17:52
Speaker 3: operate them, and engaging our internal partners with the different
17:57
Speaker 3: expertise and managing the different products that would go into
18:00
Speaker 3: some of these strategies, engaged in the conversations as well.
18:03
Speaker 3: So I wouldn't say it's at the very top of
18:05
Speaker 3: the list, but I think that, you know, this is
18:08
Speaker 3: a very interesting new trend and when you think about
18:11
Speaker 3: how these new rails might change the way that products
18:14
Speaker 3: are issued and that products are packaged in the future,
18:19
Speaker 3: this is where we're really intrigued beyond just the strategies
18:22
Speaker 3: that are being used today. Does this become the way
18:25
Speaker 3: that funds get issued in the future, do we exact
18:27
Speaker 3: or algorithmically driven automated strategies with AI coming into play here,
18:33
Speaker 3: and you know, are we going to see kind of
18:35
Speaker 3: a foundational shift in the way that asset management works?
18:37
Speaker 3: And these are big questions we like to debate inside here.
18:41
Speaker 1: Well, it's fantastic to see you guys on the edge
18:43
Speaker 1: of this because this is something that you know, I
18:45
Speaker 1: felt like we were going to see some innovators come
18:48
Speaker 1: out of this set this series.
18:50
Speaker 2: Of growth cycles within blockchain.
18:53
Speaker 1: Obviously You guys have been around it for a while,
18:55
Speaker 1: so you you recognize a lot of these trends that
18:57
Speaker 1: are starting to edge into it. Into one other trend
19:01
Speaker 1: I wanted to hit on because if you look at
19:02
Speaker 1: what Robinhood has been able to do, they've been able
19:05
Speaker 1: to gamify a lot of things like rewards, etc. What
19:09
Speaker 1: about that in the DeFi space. If we start to
19:11
Speaker 1: see Benji in the DeFi space, could we see a
19:14
Speaker 1: rewards architecture starting to layer into Franklin Templeton.
19:18
Speaker 3: I think one hundred percent there. I think this is
19:20
Speaker 3: one of the biggest opportunities we see for the future.
19:24
Speaker 3: Right when you think about your investment portfolio today, that
19:28
Speaker 3: investment portfolio is kind of sitting out to the side
19:31
Speaker 3: of your life and it's something that you kind of
19:33
Speaker 3: hope grows throughout your life to be able to use
19:35
Speaker 3: in retirement. And we think that's a very old fashioned notion,
19:39
Speaker 3: right Your investment portfolio should sit at the center of
19:43
Speaker 3: your life, and it should be providing you the benefits
19:46
Speaker 3: and rewards for where you're invested, just like a credit
19:49
Speaker 3: card would or just like a bank card would. And
19:52
Speaker 3: so we think that it's very important to really use
19:56
Speaker 3: the ability to embed contracts with assets in this new
19:59
Speaker 3: bloe chain based ecosystem to really reward investors for holding
20:04
Speaker 3: their investments and make the returns that they get not
20:08
Speaker 3: just financial returns, but rewards and benefits and opportunities and access.
20:13
Speaker 3: These are all things we think are going to become
20:15
Speaker 3: important adjuncts to what people expect out of their portfolios,
20:19
Speaker 3: and we think that's something that we're actively preparing for.
20:22
Speaker 1: When investors, sophisticated investors realize that this is happening in
20:27
Speaker 1: certain firms, they are going to flock to these kinds
20:31
Speaker 1: of tools because it's something that they recognize in their
20:36
Speaker 1: daily life. In many cases, they're structuring their whole purchasing
20:39
Speaker 1: habits around what kind of rewards can I get? Kind
20:42
Speaker 1: of you know, cash back can I get? When you
20:44
Speaker 1: layer that into investing properties, that starts to get things
20:47
Speaker 1: really interesting. Now, I've heard you and others talk about
20:51
Speaker 1: this phase of RWA's may not be as ready for
20:56
Speaker 1: the open markets yet, but there could be other areas
20:59
Speaker 1: such as cultural assets. And we've talked about cultural assets
21:03
Speaker 1: on our show with you know a lot of culture
21:05
Speaker 1: guys out there that really understand this. Will that be
21:09
Speaker 1: something that you're going to implement into your platform.
21:12
Speaker 3: Yes, that's definitely something that we believe strongly in. One
21:17
Speaker 3: of the real exciting aspects of moving onto these crypto
21:21
Speaker 3: rails is that you know, every individual as well as
21:26
Speaker 3: every institution can now also become a source of assets. Right,
21:31
Speaker 3: And that makes it a very interesting proposition because we're
21:35
Speaker 3: already seeing interesting sharing models emerge and deepen. Right, I
21:39
Speaker 3: can share my bandwidth, I can share my car's driving patterns. Right.
21:44
Speaker 3: I think that that idea of sharing is going to
21:47
Speaker 3: advance all the way to the assets that I own
21:49
Speaker 3: as an individual. Why can't I share the equity in
21:52
Speaker 3: my home or why can't I share my overall you know,
21:58
Speaker 3: physical assets like my art collect action or my boat
22:01
Speaker 3: or my you know, I wish I had a boat.
22:03
Speaker 3: But you know, what I'm saying is the kinds of
22:05
Speaker 3: assets that we might own as individuals. And I think
22:08
Speaker 3: that these are going to become very interesting ways of
22:12
Speaker 3: two way communication. Not just a firm like Franklin Templeton
22:16
Speaker 3: creating funds like this and offering them to our investment clients,
22:20
Speaker 3: but also our clients becoming sources of these assets and
22:24
Speaker 3: also being able to participate in the benefits of having
22:28
Speaker 3: those assets managed through the fees that they collect. So
22:31
Speaker 3: I think it's going to become a really great community
22:34
Speaker 3: touch point and point of two way interaction between the
22:38
Speaker 3: professional managers managing portfolios and the clients that are investing
22:42
Speaker 3: into those funds.
22:44
Speaker 1: Well, listen, I think first of all, you guys have
22:45
Speaker 1: a lot of products that are one very innovative. Do
22:49
Speaker 1: you feel like sometimes you're too early? You know, because
22:52
Speaker 1: you guys have been around since twenty one, You've put
22:54
Speaker 1: a lot of the new products out there. You were
22:55
Speaker 1: the first on money market products available when it comes
22:59
Speaker 1: to especially what's happening in blockchain, Are you worried that
23:03
Speaker 1: you're too early here?
23:04
Speaker 2: No?
23:05
Speaker 3: It things always innegatively take longer than you expect. You
23:10
Speaker 3: run up against all sorts of you know, small hurdles
23:14
Speaker 3: but none to less hurdles that you have to get through,
23:18
Speaker 3: and so you know, it's never too early to really
23:21
Speaker 3: be thinking about the future and planning for it. And
23:25
Speaker 3: you know, we're perfectly happy to have an early lead.
23:28
Speaker 3: And then you know, we believe firmly that that lead
23:31
Speaker 3: will pay off for us, even if the asset growth
23:34
Speaker 3: isn't happening right away. We think that the learnings that
23:38
Speaker 3: we have, the ecosystems we're getting embedded into the capabilities
23:43
Speaker 3: that we're building out, and being able to test in
23:46
Speaker 3: the market real time as the scale grows, these are
23:49
Speaker 3: all advantages that we think are going to position us
23:51
Speaker 3: to be one of the top firms offering asset management
23:55
Speaker 3: over the coming decades. So we're willing to put the
23:58
Speaker 3: investment in. I don't think you can ever be too early.
24:01
Speaker 2: Yeah, well, that's good that you are.
24:03
Speaker 1: You mentioned ecosystems, infrastructures within that. What about what chains
24:09
Speaker 1: are coming, anything that's in the pipeline for you guys
24:12
Speaker 1: to start to integrate into some of your products and services.
24:16
Speaker 3: Yeah. I think my team would kill me if I
24:18
Speaker 3: start to give the games out, but I will say
24:21
Speaker 3: I will say that we are definitely continuing to look
24:24
Speaker 3: to expand across chains. We are really watching the use
24:28
Speaker 3: cases that are growing on different chains and are very
24:32
Speaker 3: excited about some of the newer opportunities that we see emerging.
24:37
Speaker 3: So I think you will see us continue to expand
24:41
Speaker 3: our ecosystem and because of the platform we've built, every
24:44
Speaker 3: time we add a chain, we create interoperability for our
24:48
Speaker 3: clients across that whole set of chains. So we think
24:51
Speaker 3: that too, is going to be a long term advantage
24:53
Speaker 3: for us.
24:54
Speaker 1: Yeah, for sure. You guys can read between the lines
24:56
Speaker 1: a little bit. I mean, you know what chains they're on,
24:59
Speaker 1: think about the that they're looking at. If you were
25:01
Speaker 1: in their position, which ones are the strong ones? And
25:04
Speaker 1: then you can kind of get a picture of that,
25:06
Speaker 1: because I know everybody's out there just going which one
25:08
Speaker 1: will it be?
25:09
Speaker 2: Which one will it be?
25:10
Speaker 1: Sandy, It has been great having you on. Thank you
25:13
Speaker 1: so much for coming in today. We really appreciate it great,
25:16
Speaker 1: Thank you so much.
25:16
Speaker 3: I really enjoyed the conversation.
25:18
Speaker 2: You bet all right.
25:19
Speaker 1: If you guys are not in our Diamond Circle, that's
25:21
Speaker 1: our own private group. You can join absolutely free. All
25:24
Speaker 1: you have to do is hit the link down below,
25:26
Speaker 1: and of course follow me out there on X at
25:29
Speaker 1: Paul Baron. We'll catch you next time right here on
25:31
Speaker 1: The Paul Baron Show.