Billion-dollar asset manager Franklin Templeton is looking to expand its footprint in the crypto ETF market by filing with the U.S. Securities and Exchange Commission (SEC) to issue a dual crypto ETF. The filing comes second only to that of South American firm Hashdex, as both investment firms seek to expand a highly attractive crypto spot ETF market.

Franklin Templeton Throws Early Hat for Crypto Index ETF

On August 16, Franklin Templeton filed to issue the “FRANKLIN CRYPTO INDEX ETF,” an investment trust designed to hold both Bitcoin and Ethereum. This proposed dual spot ETF will be listed and traded on the Chicago Board Options Exchange (CBOE), with U.S. crypto exchange Coinbase serving as the designated custodian of all assets held in the trust.

With the FRANKLIN CRYPTO INDEX ETF, Franklin Templeton aims to expand its reach into the U.S. crypto spot ETF market after previously launching Bitcoin- and Ethereum-based exchange products. While both mutual funds have garnered some interest and found stability with a combined $445 million inflows, their market performance pales in comparison to their counterparts sponsored by other asset managers such as BlackRock and Fidelity.

Therefore, an early nod to the Crypto Index ETF market could help the American investment firm improve its current market position in that regard. However, as mentioned earlier, Franklin Templeton’s application to launch a dual crypto ETF lags behind that of Brazilian asset manager Hashdex. The SEC has already postponed its approval decision on Hashdex’s application, saying more time is needed to understand the complexities of the dual crypto ETF.

In the coming weeks, Franklin Templeton is also expected to reveal more information about its newly proposed ETF, as the SEC considers an initial response that must be given within 45 days. This information will include the distribution percentage of both Bitcoin and Ethereum, as well as the fund’s sponsorship fee. Franklin Templeton is known for offering investors relatively low fees, as evidenced by the meager 0.19% sponsorship fee associated with both of its current crypto spot ETFs.

Crypto ETFs pave the way for institutional growth

The SEC’s historic approval of Bitcoin Spot ETFs in January marked a significant shift in traditional finance’s interest in cryptocurrency. This interest is evident in the current valuation of the Bitcoin ETF market at $17 billion, alongside the recent launch of an Ethereum Spot ETF.

In addition to the new venture of a dual crypto ETF, discussions about the possible introduction of Solana and XRP ETFs are gaining momentum, with some analysts predicting a possible launch as early as 2025. Notably, spot ETFs have significant potential to drive cryptocurrency demand and growth in the coming years, in terms of encouraging adoption by traditional financial institutions.

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