Franklin Templeton on Thursday announced it is pursuing regulatory clearance to introduce a new crypto index ETF. It comes as asset managers are eager to capitalize on the rising crypto trend following Donald Trump’s victory in the US presidential elections.
The filing reveals that this is the second amendment to the previously submitted S-1 registration statement for the Franklin Crypto Index ETF. While the SEC had approved an earlier version of the ETF in December, the current filing indicates that Franklin is looking to incorporate a wider variety of assets in future.
If approved, the Franklin Crypto Index ETF could provide exposure to the spot prices of Bitcoin and Ether in a single fund listed on the Cboe BZX Exchange, with each cryptocurrency weighted according to its market capitalization. As of Feb. 5, Bitcoin made up 86.31% of the digital assets in the underlying index while Ether accounted for 13.69%.
The underlying index will be adjusted and restructured quarterly on the first business day of March, June, September and December, the filing said.
Other Crypto Tokens Could Join Franklin Templeton’s ETF—But Not Yet
Franklin Templeton’s filing indicates that the firm may expand the Crypto Index ETF to include additional crypto tokens in the future. However, this will only happen once both the fund and the Cboe BZX Exchange secure the necessary regulatory approvals to hold these digital assets, it said. This provision allows the firm to adapt its ETFs if the SEC approves more cryptocurrencies.
While there’s no guarantee that a liquid market for the shares will emerge, they will still be listed and actively traded on the Cboe BZX Exchange under the ticker symbol “EZPZ,” the investment firm said.
Further, Franklin warned investors about potential risks, saying that a temporary or permanent “fork” could reduce the value of the shares. Additionally, the rise of competing digital assets and smart contract platforms—such as Solana, Avalanche, or Cardano—could weaken demand for existing digital assets, ultimately driving down their prices and negatively impacting the shares’ value, it said.
Bitcoin and Ether ETFs Gain Approval—Will Solana and XRP Be Next?
For years, the SEC resisted approving ETFs that invest in Bitcoin, citing concerns over investor protection. However, that stance changed last year when the agency approved Bitcoin and Ether ETFs, paving the way for both retail and institutional investors to gain broader exposure to Bitcoin.
Since then, several firms have applied to launch ETFs tied to other cryptocurrencies like Solana and XRP. While these proposals are still under review, their potential approval could further expand the crypto ETF market.
Just last month, Bitwise secured initial approval from the SEC for its ETF that tracks both Bitcoin and Ether. The SEC granted accelerated approval, allowing NYSE Arca to list and trade shares of the hybrid fund.
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