Blockchain and digital assets enter the mainstream financial markets
2021 was a crucial year in the development of blockchain and digital assets – and they are poised to become essential features of conventional financial markets.
Franklin Templeton and ARK Invest are each pioneers in the crossover between traditional finance and disruptive technologies. Over the past year Dechert has assisted both of these investment managers in innovations that promise to be catalysts for new industry standards. For Franklin Templeton, Los Angeles- and Silicon Valley-based partner Timothy Spangler helped create a first-of-its- kind SEC-registered mutual fund, the Franklin OnChain Government Money Fund, using blockchain to distribute and trade traditional financial assets. Blockchain is the technology that serves as the basis for cryptocurrencies such as Bitcoin. “There was no template,” explains Spangler, “so we worked with the client to structure and launch an entirely new type of mutual fund that has the potential to be a game-changer for the industry.” SEC approval was received in April 2021. “Taking traditional asset management products – such as equity, debt and derivatives – into the digital realm is an evolutionary step-change in how our financial markets operate,” says Spangler. “Dechert’s familiarity in dealing with regulators was invaluable, as the clearance, settlement and trading of digitalized securities had never been considered before by SEC in the context of a retail mutual fund.” Spangler has also advised ARK Invest on launching its private Bitcoin fund. Increasingly, institutional investors are demanding access to cryptocurrencies in their portfolios and investment management firms, both traditional and alternative, will need
During 2021, Dechert’s fintech NEXT webinar series explored the evolving issues that the industry faces, partnering with clients and other experts to present conversations addressing fintech challenges. Episodes this year included:
to have products available for them. “This a great example of the way in which cryptocurrencies are creating a new paradigm for the way in which funds are stored and transferred for investors,” says Spangler. “Our team is able to draw on Dechert’s 40-year track record innovating in funds,” adds Spangler. “When combined with our deep expertise in blockchain and digital assets, this gives our clients a powerful advantage.” The mainstreaming of bitcoin – a conversation about the mainstreaming of bitcoin. Our speakers discussed the evolution of the space, including the drivers of demand, the resulting price action and how investors might consider it as part of a balanced portfolio. A conversation with the experts: The CPRA and what it means for your business – following the approval of the California Privacy Rights Act (CPRA), our speakers discussed key differences between the CCPA and CPRA and related operational impacts and potential restrictions on targeted advertising
Crypto vs. Fiat: Can the new world of crypto and the old world of fiat live side-by-side? – lessons learned
from industry and regulatory developments, including the
Expertise in disruptive law firms in the financial services space and more of a requirement.” Timothy Spangler Partner “ technologies is becoming less of an option for Binance ban by the UK’s FCA, and how Divi Project’s mission addresses the challenges of regulated cryptocurrencies. Better understanding risk in the investment process – a conversation on portfolio risk management in the post-pandemic era, including the role of digital assets in portfolio construction
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