Franklin Templeton Files for Bitcoin & Ethereum Index ETF

Franklin Templeton Investments, a trillion-dollar asset manager, has filed a proposal to the U.S. Securities and Exchange Commission (SEC) to launch a Bitcoin and

Asset manager Franklin Templeton, which oversees trillions of dollars, has filed a proposal with the U.S. Securities and Exchange Commission (SEC) to launch an ETF that will track Bitcoin and Ethereum. The fund, which will be called the Franklin Templeton Bitcoin & Ethereum Crypto Index ETF, will provide investors with exposure to both Bitcoin and Ethereum, the world’s two largest cryptocurrencies.

Franklin Templeton Files for Bitcoin & Ethereum Index ETF

According to a recent filing, Franklin Templeton has proposed launching a new ETF that will enable investors to gain exposure to both Bitcoin and Ethereum in a single fund. The ETF’s assets will consist of Bitcoin, Ethereum, cash, and cash equivalents, which are short-term securities maturing in less than three months.

This fund will allow investors to easily invest in both cryptocurrencies without having to own the underlying assets.

The fund will be both held and distributed by BNY Mellon, a company that provides financial services around the world, while Coinbase Custody will handle the ETF’s digital assets. The proposed ETF will be benchmarked against the CF Institutional Digital Asset Index, which measures the performance of Bitcoin and Ethereum in the prevailing market conditions.

Combining Bitcoin and Ethereum in One Fund

This proposed ETF will be the first of its kind to invest in both Bitcoin and Ethereum in a single index fund. It is designed to provide investors with an easier way to invest in the two largest digital currencies by market capitalization. By offering both assets in one product, the asset manager aims to simplify the process of gaining access to the top cryptocurrencies for both institutional and retail investors, without having to navigate the volatility and complexities of cryptocurrency exchanges.

The Franklin Templeton Bitcoin & Ethereum Crypto Index ETF will be available in blocks of 50,000 shares. The price per block will be equal to the net asset value (NAV) of the Bitcoin and Ethereum held in the fund. However, the ETF will not engage in staking or other methods of earning yield on the digital assets.

In other related news, the ETF filing is part of the asset manager’s expansion into blockchain technology. Recently, the firm integrated the OnChain U.S. Government Money Market Fund into the Aptos blockchain. This move enhances the fund’s accessibility as the use of tokens enables the fund to be bought and sold on the blockchain.

US SEC to Provide Regulatory Oversight

The launch of the ETF is subject to the approval of the U.S. Securities and Exchange Commission (SEC), which focuses on protecting investors from fraud and market manipulation of the underlying assets. The proposal outlines oversight agreements with regulated futures markets, such as the CME Bitcoin and Ether Futures, as part of its framework.

Crypto ETFs have faced difficulties in the U.S. because of stringent regulations and the Securities and Exchange Commission has been hesitant to approve these products. Moreover, this application comes as several other applications for crypto-related ETFs are pending, including Bitwise’s application for an XRP ETF.

The regulator has repeatedly insisted on having strong measures against fraud, and Franklin Templeton’s plan aims to achieve this through the use of regulated futures markets and a robust custody arrangement.

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