Trillion-dollar asset manager Franklin Templeton is looking to expand its presence in the cryptocurrency ETF market after filing with the U.S. Securities and Exchange Commission (SEC) to launch a dual cryptocurrency ETF. The filing follows a request from South American firm Hashdex as both investment firms look to expand the highly attractive crypto ETF market.
Franklin Templeton Invests Early in Crypto ETF
On August 16, Franklin Templeton presented application To launch the “Franklin Crypto Index ETF,” an investment fund designed to hold both Bitcoin and Ethereum. The proposed dual ETF is set to be listed and traded on the Chicago Board Options Exchange (CBOE) with US cryptocurrency exchange Coinbase acting as designated custodian for all assets invested in the fund.
With the FRANKLIN CRYPTO INDEX ETF, Franklin Templeton is looking to expand its reach into the U.S. cryptocurrency ETF market after previously launching Bitcoin and Ethereum-based exchange-traded products. While both funds have attracted some interest and found stability with total inflows of $445 million, their market performance pales in comparison to peers sponsored by other asset managers like BlackRock and Fidelity.
Therefore, early approval of the crypto ETF market could help the American investment firm improve its current market position in this regard. However, as previously mentioned, Franklin Templeton’s application to launch a dual crypto ETF comes after the application of Brazilian asset management company Hashdex. Indeed, the SEC has postponed its decision on approving Hashdex’s application, citing the need for more time to understand the intricacies of a dual crypto ETF.
Franklin Templeton is also expected to reveal more information about its newly proposed exchange-traded fund in the coming weeks, as the SEC considers a preliminary response that must be filed within 45 days. This information includes the percentage distribution of both Bitcoin and Ethereum as well as the fund’s custodian fees. Franklin Templeton is known to offer investors relatively low fees, as evidenced by the paltry 0.19% custodianship fee attached to its current crypto ETFs.
Cryptocurrency ETFs Paving the Way for Institutional Growth
The historic approval of Bitcoin ETFs by the U.S. Securities and Exchange Commission in January marked a major shift in the traditional finance industry’s interest in cryptocurrencies. This interest is clearly evident in the current valuation of the Bitcoin ETF market at $17 billion, along with the recent launch of an Ethereum ETF.
Alongside the new project of a dual crypto ETF, discussions around the potential launch of Solana and XRP ETFs are gaining momentum, with some analysts predicting a potential launch as early as 2025. Notably, spot ETFs have great potential to drive demand and growth for cryptocurrencies in the coming years in terms of boosting adoption by traditional financial institutions.
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