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Franklin Templeton, the prestigious firm that manages at least $1.5 trillion in assets, has become the latest Wall Street titan to file paperwork for a spot Ethereum exchange-traded fund (ETF). Franklin Templeton joins its brethren BlackRock, Fidelity, Invesco, Grayscale, and others in vying for a spot ETH ETF.
Spot ETH ETF Race Heats Up
Franklin Templeton is the latest financial services heavyweight to apply for a spot ETF product based on the industry’s second-largest cryptocurrency, ether.
In a filing with the United States Securities and Exchange Commission, Franklin Templeton proposed listing “Franklin Ethereum ETF” on the Chicago Board Options Exchange. Such a product would give everyday institutional and retail investors an easy way to gain exposure to the price of ETH in their brokerage accounts without the complexities of buying and storing the underlying crypto.
The San Mateo, California-headquartered company has chosen Coinbase Custody Trust Company and the Bank of New York Mellon as the fund’s custodians. Notably, Franklin revealed its intention to stake a portion of Ether from the trust’s cold storage wallets to generate additional income in the S-1 registration form.
“The Sponsor may, from time to time, stake a portion of the Fund’s assets through one or more trusted staking providers, which may include an affiliate of the Sponsor.”
Like BlackRock and ARK Invest, Franklin Templeton has also adopted a cash-only methodology for creating and redeeming shares.
ETH Climbs 7%
Franklin Templeton is already a top name for spot Bitcoin (BTC) ETFs after the SEC’s landmark approval roughly four weeks ago. After a decade of denials, the regulator finally gave the nod to 10 spot BTC ETFs, including Franklin’s, to commence trading on U.S. stock exchanges. Notably, Franklin’s spot Bitcoin ETF is currently the cheapest after slashing its fee to 0.19% from 0.29%.
Since the January approvals, billions of dollars have poured into the spot ETFs, propelling the cryptocurrency price higher. BTC recently crossed the $50,000 threshold for the first time since December 2021, while the price of ether rose 7.4% in the last 24 hours, to hover at around $2,670.
The SEC has so far deferred all decisions to approve a spot ether ETF, as expected by pundits. Interestingly, banking giant Standard Chartered said in a late January report that it foresees a handful of spot Ethereum ETFs getting the green light from the SEC by May 2024, which would drive the price of ETH to the coveted $4,000 milestone.