Legal & General (L&G), a leading UK-based pension and investment management firm that oversees $1.5 trillion in assets, is preparing to enter the growing world of blockchain-based tokenization, following in the footsteps of other traditional finance leaders such as BlackRock, Franklin Templeton and Abrdn.
UK Pensions Giant L&G Eyes Crypto Tokenization
Tokenization refers to the process of representing traditional assets, such as money market funds backed by U.S. Treasuries, through blockchain-based tokens.
The financial sector has increasingly embraced tokenization due to its potential to increase efficiency, reduce costs, and expand access to new groups of investors.
BlackRock’s BUIDL fund on the Ethereum blockchain is a prominent example, and other global financial institutions such as State Street and Franklin Templeton have launched tokenized financial products.
L&G's Tokenization Vision
L&G’s asset management arm, Legal & General Investment Management (LGIM), is currently evaluating how it could offer liquidity funds in tokenized form.
“The digitalization of the funds industry is key to increasing efficiency, reducing costs and offering a broader range of investment solutions,” said Ed Wicks, LGIM’s global head of trading. “We look forward to continuing progress in this area.”
L&G’s interest in blockchain technology is not new. In 2019, the firm announced plans to use Amazon Web Services (AWS) blockchain infrastructure to manage and record bulk annuities for its insurance operations.
*This is not investment advice.