FxNews—Legal & General (L&G), a major pension and investment management company based in London with assets totaling $1.5 trillion, is considering entering the increasingly popular area of blockchain-based tokenization. This digital approach is gaining traction among leading financial institutions.
BlackRock Leads Rise in Asset Tokenization
Tokenization involves transforming traditional assets, such as money-market funds backed by U.S. Treasuries, into digital tokens on a blockchain. This method has seen a surge in popularity following BlackRock’s introduction of the BUIDL fund on the Ethereum blockchain.
Other major players, such as Franklin Templeton, State Street, and Abrdn, have also entered this space.
Legal & General Eyes Tokenized Liquidity Funds
Ed Wicks, the global head of trading at Legal & General Investment Management (LGIM), highlighted their ongoing evaluations to offer their liquidity funds in a tokenized format potentially. This inquiry was revealed through an email about the firm’s future strategies.
The digitization of the investment industry is pivotal for enhancing operational efficiency, reducing costs, and expanding the availability of investment solutions to a broader audience. Ed Wicks expressed optimism about future developments in this sector.
Legal & General Adopts AWS Blockchain for Annuities
Legal & General began engaging with blockchain technology in 2019. The company announced its plans to utilize a managed blockchain system provided by Amazon Web Services (AWS) to oversee and document bulk annuities within its insurance division.
LGIM represents Legal & General’s asset management segment, playing a crucial role in the firm’s overall operation and financial management strategy.