At CoinDesk’s annual Consensus conference, CEO Jenny Johnson said cryptocurrencies like bitcoin were a “distraction” from the benefits of blockchain technology.
AUSTIN, Texas – Grousing about the state of crypto regulations in the U.S. has become the norm for many industry players, but Franklin Templeton’s 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.
Speaking at CoinDesk’s Consensus Festival on Wednesday, Johnson said that the future of the industry “will be regulated,” and that cryptocurrencies like bitcoin were a “distraction” from crypto’s real innovation, blockchain technology.
“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 US 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 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 it 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 up investment opportunities for asset managers by reducing friction and eliminating “toll takers” that currently waste resources.
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