AUSTIN, Texas — Grousing about the state of crypto regulations in the U.S. has become the norm for many industry players, but Franklin Templeton CEO Jenny Johnson said she thinks it’s important for the industry to accept that more regulations are coming – whether they like it or not.
“Bitcoin is the greatest distraction from the greatest disruption [coming to the financial system], and that’s blockchain,” Johnson said.
“I can tell you, if bitcoin ever became so big that it became a threat to the U.S. dollar as the reserve currency, the U.S. would limit … the use of bitcoin. Currencies are very important for governments … to manage their economies,” said Johnson. “They will not cede their currency to this concept of a global currency.”
Johnson added that it’s better for companies to engage directly with regulators as they develop new products. Johnson added that Franklin Templeton, which manages $1.5 trillion in assets, has been in close contact with the U.S. Securities and Exchange Commission (SEC) as it developed its newly launched blockchain-based mutual fund.
Johnson added that the global investment firm, which has offices in over 30 countries worldwide, is used to working with regulators outside the U.S. as well.
“I can tell you, different areas in the world are more advanced than others, more comfortable with [crypto] than others,” Johnson said, naming Singapore, Hong Kong, and the UAE as examples of crypto-friendly jurisdictions.
Johnson said that regulators, both in the U.S. and outside of it, are nervous about passing regulations that could have unintended consequences.
“This is a complicated space, and the regulators are trying to be thoughtful,” Johnson said.
Regulatory uncertainty aside, Johnson is still bullish on the potential for crypto and blockchain technology to disrupt the financial industry. Blockchain technology could, according to Johnson, open investment opportunities for asset managers by reducing friction and eliminating “toll takers” that currently waste resources.
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is an award-winning media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. In November 2023, CoinDesk was acquired by Bullish group, owner of Bullish, a regulated, institutional digital assets exchange. Bullish group is majority owned by Block.one; both groups have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary, and an editorial committee, chaired by a former editor-in-chief of The Wall Street Journal, is being formed to support journalistic integrity.