New ETF Filing by Franklin Templeton Aims for Exposure to Bitcoin and Ethereum

Franklin Templeton, a prominent asset management company in the United States, has submitted an application to the Securities and Exchange Commission (SEC) to introduce a Crypto Index Exchange-Traded Fund (ETF). This strategic move underscores the increasing interest among institutional investors in crypto ETFs, particularly those linked to assets like Bitcoin.

The application, filed on August 16 by Franklin Templeton, seeks to establish the “Franklin Crypto Index ETF,” designed to provide investors with diversified exposure to various cryptocurrencies. Initially, the index will concentrate on Bitcoin and Ethereum, with potential plans to incorporate additional assets in the future.

As outlined in the filing submitted to the SEC, the Crypto Index Fund will adopt a weighted structure, with allocations based on the market capitalization of the underlying assets. Pricing data for the index will be sourced from the CME CF Bitcoin and Ethereum reference rates.

If approved by the SEC, the fund could draw investors away from single-asset ETFs, potentially positioning Franklin Templeton as a dominant force in the market. This development reflects the growing institutional interest in the evolving crypto sector, with data from K33 Research’s Senior Analyst, Vetle Lunde, indicating a rise in the number of professional firms investing in crypto-related spot ETFs during the second quarter.

While retail investors continue to hold a significant share of the market, institutional investors have increased their holdings by 2.41% of their Assets Under Management (AUM). Notable players like Millennium and Susquehanna remain the largest holders of spot Bitcoin ETFs, with new participants such as Jane Street and Paul Tudor Jones making significant Bitcoin ETF investments during this period.

In light of the surge in institutional engagement, CoinShares’ Head of Research, James Butterfill, highlighted that investment advisors currently manage the highest AUM in the market. Investment advisors and Brokerages lead with $4.7 billion and $1.5 billion, respectively, followed by Hedge Funds and Holding companies with $3.8 billion and $1.1 billion, respectively.

The evolving landscape of crypto investments continues to attract attention, with institutional players increasingly shaping the market dynamics.