Franklin Templeton Sees Web3 Driving Next Wave of Tech Innovations

In a new report, the asset management giant outlines tech-driven megatrends – decentralization among them – that are shaping society.

AccessTimeIconMar 27, 2023 at 1:00 p.m. UTC
Updated Mar 8, 2024 at 4:52 p.m. UTC

Decentralization will help drive a fourth wave of technology-backed innovations, according to a new report from global asset manager Franklin Templeton. The report outlines five “megatrends” that are transforming modern society.

Franklin Templeton, a financial giant with about $1.5 trillion in assets under management, has long experimented with blockchain technology. The company has made firmer moves into the space in recent years, and announced last September plans to offer digital asset strategies to wealth managers.

“The whole reason that we've laid out the megatrends, and the reason that we think they're important to highlight, is that this set of technology innovations and the changes that they've been driving in society is what has brought us to this Web3 moment and the development of this critical crypto ecosystem,” Sandy Kaul, head of Franklin Templeton’s digital asset and industry advisory services, told CoinDesk in an interview.

Key tech-driven megatrends

The infrastructure that businesses use for their commercial activities has moved from proprietary networks to easier-to-adapt open networks, which allows for broader participation from individuals and newer businesses but puts disproportionate power in the hands of the Web2 companies that operate or facilitate the networks, according to the report. Companies have likewise moved from a focus on tangible assets to drive value to intangible assets – such as adopting new technologies to remain competitive. Those technologies have transitioned over the decades from the then-new internet to the continuing rise of decentralized solutions.

On the consumer side, these business shifts have increased the impact an individual’s voice can have on a company’s strategy, said the report. The long-valued fields of data analytics and business intelligence have pivoted to better understanding customers and enhancing their experiences and have also moved from real-time insights to predicting future behavior.

Individuals have also gained more power through the use of digital asset platforms, which have made the asset classes and complex financial products used by institutional investors more broadly available, the report continued. This is most evident in tokenized assets (both fully digital and digital versions of real-world assets) and decentralized finance (DeFi), which offers advanced trading techniques like derivatives and staking.

“For people from the traditional financial world who still are not convinced about the potential of what these new models represent, I think it's important to tie it to the history of innovation, and to the trajectory that this innovation has taken us throughout the last 60 years,” said Kaul. “This is not something that just popped up out of the blue.”

Edited by Stephen Alpher.


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Brandy Betz

Brandy covered crypto-related venture capital deals for CoinDesk.