Crypto investors could be forgiven for feeling besieged as markets are down more than 50% from record highs reached in the fall of 2025. For Wall Street veteran Sandy Kaul, however, the historic parallels to the birth of the hedge fund industry in the wake of the dot.com crash offers hope — and opportunity.
When that "second wave" of hedge fund investors emerged in 2002, it gave rise to the multi-strategy and fund-of-funds hedge fund offerings that saw assets
"I feel like we are at the exact same point in that cycle with crypto," Kaul, head of digital assets and innovation at $1.7 trillion-asset Franklin Templeton, said in an interview. "We've had the big bull market with a lot of retail interest, we've kind of seen retail move on a bit, just like they did after the dot-com boom. We are now seeing a turnover of positions into more institutional hands."
Kaul has spent her career at bulge-bracket firms Citibank, JPMorganChase, Goldman Sachs and Shearson Lehman Brothers. It's that longevity and perspective that gives her a sanguine view as to the current carnage in digital-asset markets.
The market shakeout has allowed Franklin Templeton to take advantage of a lot of great traders who might be having a second year in the red. In June, the bank closed its acquisition of 250 Digital to create a "dedicated active digital-asset management division" that it's calling Franklin Crypto, which oversees $1.8 billion in assets. Kaul was a driving force behind the purchase.
"It's a great time to pick up top talent," said Kaul, who leads 217 employees, including eight direct reports. "This is my bigger picture thinking around what we are doing with 250 and why I think this is the right time to be doing this. … Think of this as the kickoff of our building."
Assets under management for The Benji Technology platform, a proprietary blockchain-integrated recordkeeping system that enables the tokenization and servicing of mutual funds on public blockchain infrastructure, doubled from $687 million in March 2025 to $1.4 billion in March 2026. Total AUM across all FT digital assets products, including crypto ETFs and other programs, grew to $2.2 billion as of March 2026, while the firm's goals optimization engine fintech advice algorithm reached $1.2 billion in assets under management, growing 260% from $332 million in March 2025.
BENJI, the tokenized share-class representation of Franklin OnChain U.S. Government Money Fund, or FOBXX — the world's first U.S. registered mutual fund to use a public blockchain to record transactions and ownership — has grown to over $2.5 billion in AUM as of June 2026.
Kaul also oversees the firm's Franklin Innovation Research, Strategies, and Technologies project, or FIRST, which develops new products and deploys digital-asset capabilities across the company with an emphasis on blockchain and artificial intelligence.
Noting the current market downturn, or "risk off" phase, Kaul said investors are looking to earn yield on the digital money they hold. A more-recent type of tokenization has come in the form of traditional assets like stocks that are aimed at so-called crypto-native investors, she said.
"This is a new investment audience," she said. "They want to diversify. That's where all this demand for tokenized U.S. stocks is coming from."
Kaul serves as co-chair of the U.S. Commodity Futures Trading Commission's Digital Asset subcommittee and is on the World Economic Forum Digital Assets advisory board. She said recent legislative and regulatory progress has brought needed clarity to U.S. crypto markets.
"Between equities and bonds there's about $300 trillion of assets under management, versus $2 trillion in crypto markets," Kaul said. "Having that regulatory certainty gives those people who need the diversification in their portfolio the cover to be able to make those allocations, and that will give more depth to the crypto markets."
