BNY sees 'FOMO' driving asset managers into tokenized funds
Key takeaways
- BNY says firms are moving ahead with tokenized fund products despite unresolved questions around regulation, trading infrastructure and market structure.
- "We have a number of different projects in flight, different variants to effectively tokenize ETFs," Ben Slavin, global head of exchange-traded funds (ETFs) at BNY, said in an interview.
- The trend comes as major firms, including BlackRock, Franklin Templeton and others, explore ways to place traditional financial products on blockchain rails, a process that allows fund shares to trade as digital tokens.
BNY says firms are moving ahead with tokenized fund products despite unresolved questions around regulation, trading infrastructure and market structure. Issuers face growing reputational risks as third parties create tokenized versions of existing ETFs that can trade outside traditional financial markets without their involvement.As tokenization moves from industry experiment to commercial product, asset managers are rushing to establish a foothold in the market.
"We have a number of different projects in flight, different variants to effectively tokenize ETFs," Ben Slavin, global head of exchange-traded funds (ETFs) at BNY, said in an interview.
The trend comes as major firms, including BlackRock, Franklin Templeton and others, explore ways to place traditional financial products on blockchain rails, a process that allows fund shares to trade as digital tokens.