New York — The next evolution of asset management will be “portfolio native,” not just digital, according to Sandy Kaul, chief innovation officer at Franklin Templeton.
Speaking at the Ondo Summit in New York on Tuesday, Kaul said she envisions a future in which all financial assets – stocks, bonds, funds, etc. – would be held and managed via tokenized digital wallets.
“People’s entire assets will be represented in these portfolios,” she said.
The panel, which included Cynthia Lo Bessette of Fidelity, Kim Hochfeld of State Street, and Will Peck of WisdomTree, agreed that tokenization is no longer a theoretical concept. After years of slow progress, real infrastructure is now in place and use cases are expanding beyond early experiments. But panelists also warned that building utility and trust is now the industry’s biggest challenge.
“The idea of bringing an asset and representing it on-chain with a token is the simplest part,” said Lo Bessette, head of digital asset management at Fidelity. “The hardest part is building an ecosystem for utility purposes.”
Despite recent growth, adoption remains early. Hochfeld, global head of digital and cash at State Street, said much of the current work is focused on internal and customer education.
“We’re not seeing a rush for the door yet,” Hochfeld said. “We need to experiment…and see what works.”
This includes explaining the systemic benefits of tokenization. Hochfeld highlighted the crisis of the 2022 UK mini-budget, when traditional fund redemptions created a liquidity spiral. She argued that the token funds could have served as instant collateral, thereby mitigating disruption.
“Here’s your perfect use case,” she said. “It suits money market fund managers, collateral creditors, regulators – everyone.”
WisdomTree’s Will Peck said customer interest is growing, particularly from crypto-native companies that manage stablecoin treasuries or are looking for yield-generating assets that stay on-chain. He compared the current wave of tokenization to the launch of exchange-traded funds (ETFs) 30 years ago.
“No one at the time was saying, ‘I want an ETF,’” Peck said. “The ETF simply performed better.”
This same model can now be applied to tokenized products. With new “universal liquidity layers” forming on blockchain, asset managers are preparing for a future of transparent, globally accessible and hyper-personalized wallets.
“You won’t even notice,” Kaul said. “It’s going to be so seamless and seamless.”
