00:00So let's talk a little bit about what you do, because tokenization, I mean, hopefully all of us, including me,
00:06get the basics of it.
00:07But you here are, of course, head of issuer growth.
00:11Securitize works with a bunch of asset managers, BlackRock probably chief among them here.
00:17So tell us a little bit about what your role looks like.
00:20Yeah, so I mean, Securitize, we're a tokenization platform.
00:23We're the world's leading tokenization platform.
00:25And to your point, we work with issuers to tokenize their funds and their stock.
00:28So we work with the world's largest asset managers, including BlackRock, VanEck, BNY, Hamilton Lane, Apollo, to name a few,
00:35as well as public companies to tokenize.
00:38And what really sets us apart is we really approach it in a regulated and compliant way.
00:42So we have regulated entities in the U.S. as well as in Europe to ensure that we're supporting issuers
00:48end-to-end in their tokenization journey.
00:50So we support them throughout, you know, from a product design and consultation to tokenization, record-keeping on-chain, fund
00:58servicing, to distribution and secondary trading of the assets.
01:02Okay, so I hear about tokenization a lot.
01:05I've got dove deep into the topic.
01:07There's definitely movement here.
01:09You can see all the big names.
01:10But then it gets like, oh, are ETFs challenged by tokenization?
01:14And I want to get your take on this.
01:16Okay, aren't tokens really just distributing ETFs for now?
01:21Because you're teaming up with these ETFs.
01:23Why are you doing that?
01:24To give the on-chain people who have grown up in crypto regular people's assets so they can diversify.
01:32Thus, we have a prediction that ETFs will hit $50 trillion by 2035.
01:38Now, we originally put $35 trillion, but they're growing at 32% annualized.
01:44You can see the chart here.
01:46Are we going to be wrong?
01:48Will tokens challenge this chart because you're going to get the boomers to leave their brokerage account and move on
01:54-chain?
01:55Will that happen, or are we just going to distribute ETFs for now?
01:59Yeah, I mean, when you look at ETFs, it's about revolutionizing the investment vehicle that you're offering these portfolios to
02:05investors.
02:07Tokenization is the next iteration of that.
02:09It's about modernizing the rails that the market is built on.
02:12So tokenization will bring stocks or ETFs on-chain and allow ownership to be represented as a digital certificate in
02:21a wallet
02:22that will be easily transferable in a compliant way, and there's more efficiencies and more programmatically.
02:30And so from a distribution standpoint, to your point, that's really one of the reasons why issuers are tokenizing,
02:36is to be able to reach that crypto-native investor base.
02:39They have a global reach, have a new investor base that might not be buying ETFs there today already.
02:45So to your point, I do think it's an accelerant for growth for ETFs.
02:49It's going to allow investors globally to now easily be able to access their ETFs, be able to transfer it
02:56easily,
02:57and then also create more utility once an ETF is tokenized.
03:00Like when, as an investor today, I can buy, can sell, can hold an ETF.
03:04Once it's tokenized, I can also now use it as collateral to borrow against.
03:08So I have more options to what to do with my investments in the future.
03:12Okay, good.
03:13We can hold off calling this show Token IQ for a number of years.
03:17That's good.
03:17It's coming, though.
03:18Now, the other thing is, I have this other theory, which is that a lot of these OG Bitcoiner types,
03:24they, again, their whole portfolio is Bitcoin and crypto.
03:26So they are moving into, again, the regular people's assets, like stocks and ETFs.
03:32And that is part of what has made Bitcoin struggle, is that the price has been kind of flat.
03:37It's been like an IPO moment, the ETF.
03:39It's like, oh, I've been in it for a long time.
03:41I've survived all these drawdowns.
03:42Let me cash out a little bit.
03:44Diversify.
03:44I'm a little older.
03:45Maybe I have more needs financially.
03:48So is this partially why the price of Bitcoin has been struggling, is that a lot of these OGs
03:53are actually using your tokens to get regular people's assets as opposed to buying more Bitcoin?
03:58I mean, the adoption of tokenized securities, or they're called RWA, it's a real world asset,
04:03but maybe we need to rebrand it as real people assets.
04:06Either way, some of these acronyms, we can think about how to market them.
04:10But yes, I mean, people are investing into these tokenized funds because they're a diversification
04:16tool away from cryptocurrencies, considering the high volatility in cryptocurrencies, and
04:22also potentially not all of them have intrinsic value.
04:25So they're turning to investment vehicles that have been trialed and trusted from large brand
04:30name asset managers like BlackRock, like BNY, like Apollo and VanEck, so that they know what
04:35they're investing in, and they have a much more real portfolio construction when it comes to
04:41on-chain investment vehicles.
04:43So Katie, I introduced you as formerly head of U.S. equities and exchange-traded products,
04:49ETPs, at NASDAQ.
04:50I'm curious about how you see the exchanges and their role in tokenizing ETFs and other
04:56products as well, because everyone's rushing to get into this.
04:59Yeah.
04:59I mean, the exchanges play a very big part in capital formation and ensuring market integrity.
05:04And you see announcement across the exchanges about their investment into tokenized securities
05:09trading platform or enabling greater adoption for tokenization.
05:13So it's definitely, you know, they see the opportunity in tokenization and they want to help mature the
05:19market infrastructure behind tokenization.
05:21So, you know, we actually announced a partnership with the New York Stock Exchange that for their
05:26tokenized trading securities trading platform, we will be their first digital asset transfer
05:30agent.
05:30So that means that, you know, ETFs and stocks that we work with issuers to tokenize will
05:34be available for trading on the NYC platform.
05:36And we'll also be supporting with them in terms of design and also liquidity, considering that
05:41we also operate our own trading system for tokenized securities as well.
05:45So we're really excited about these institutions playing a bigger role in investing into the
05:50infrastructure.
05:50I am curious, you know, what you make of the exchange landscape, because you, of course,
05:55left in exchange.
05:56We know that when you also take a look at the New York Stock Exchange, when you take a look
05:59at SIBO, they've certainly had some high profile departures over the past several years.
06:05I mean, where does that sort of leave the traditional big three?
06:09And do you think that, you know, there is room for an upstart issuer, maybe based in Texas,
06:14to come in here and sort of upset that triopoly, I guess you would call it?
06:18Well, yeah, I mean, you know, the ecosystem in ETFs is a very robust ecosystem, really great
06:23people, really knowledgeable people.
06:25And I think competition in exchanges is good because like that, that creates more opportunities
06:30for issuers to be better service, you know, more capabilities from a marketing and support
06:35standpoint, liquidity programs that can be done to really foster more ETF adoption, especially
06:41with the number of ETFs that are coming to market today.
06:44You know, we continue to break records in terms of new ETFs come to market.
06:48So it's definitely not a zero sum game.
06:51Like, it's definitely opportunities for all exchanges to win, like even new exchanges coming
06:55on board, you know, with the volume of listings today.
06:58And, you know, likely you're going to want to be able to have your listings on multiple
07:01venues.
07:02And so I think it's a rising tide that could lift all boats right now.
07:05So last question for you very quickly.
07:07Is there anything that can't be tokenized that at this point, you know, you struggle to see
07:10how it could be tokenized?
07:11Yeah, I mean, our motto is tokenize the world.
07:14So we do live by that.
07:15And so, so no, but I mean, I think there's definitely a lot of things that needs to continue
07:19to be developed to make tokenization even greater adoption.
07:22You know, that part of that is that liquidity infrastructure.
07:25You bring on more liquidity providers, you bring on more distribution platforms, you know,
07:29that continues to get much more people trusted and, you know, more and more open to adopting
07:35to the vehicle.
Comments