Franklin Templeton seeks SEC nod for crypto index ETF

Franklin Templeton Investments has applied for regulatory approval to launch a new cryptocurrency index ETF, the Franklin Crypto Index ETF, which would provide exposure to the spot prices of Bitcoin (CRYPTO:BTC) and Ether (CRYPTO:ETH).

The ETF would be listed on the Cboe BZX Exchange and is designed to track Bitcoin and Ether's market capitalisation, with an initial composition of 86.31% Bitcoin and 13.69% Ether.

The ETF will be rebalanced quarterly in March, June, September, and December.

While the current filing includes only Bitcoin and Ether, Franklin Templeton indicated that it might add other crypto tokens in the future, contingent on receiving regulatory approval for the fund and the Cboe BZX Exchange.

However, the firm clarified that there is "no assurance" that additional tokens will be approved for inclusion.

The filing also acknowledges potential risks, including competition from other crypto assets like Solana (CRYPTO:SOL), Avalanche (CRYPTO:AVAX), and Cardano (CRYPTO:ADA), which could impact the ETF’s demand.

This filing comes alongside similar applications from Bitwise for a Bitcoin and Ethereum ETF, and other firms like Canary Capital, WisdomTree, 21Shares, and Bitwise are seeking approval for spot XRP (CRYPTO:XRP) ETFs.

The surge in crypto ETF applications follows Trump's inauguration and the shift in SEC leadership, with acting SEC chair Mark Uyeda being viewed as more crypto-friendly.

The SEC had previously approved combined spot-based Bitcoin and Ethereum ETFs from Hashdex and Franklin Templeton in December 2024, paving the way for more potential additions in the future.