Franklin Templeton launches S-1 for new crypto index ETF

Asset manager Franklin Templeton is looking to launch a new exchange-traded fund (ETF) as a one-stop-shop crypto portfolio, according to an Aug. 16 filing.

The Franklin Crypto Index ETF said it tracks the performance of the CF Institutional Digital Asset Index, which currently includes only Bitcoin (BTC) and Ethereum (ETH).

“The fund seeks to achieve its investment objective by investing in digital assets in a similar proportion to those represented in the underlying index,” it said in the filing, adding that the ETF may hold additional cryptocurrencies in the future.

Related: Regulators postpone listing decision for Hashdex Nasdaq Crypto Index ETF

The Franklin Crypto Index ETF has entered the market for crypto index ETFs, emerging as the next area of ​​focus for crypto ETF issuers after launching BTC and Ether (ETH) ETFs in January and July. It competes with the Hashdex Nasdaq Crypto Index ETF.

“The next logical step is index ETFs because indexes are efficient for investors – just like people buy the S&P 500 in an ETF. This will be the same in crypto,” Kathleen Tischhauser, head of investment research at crypto bank Sygnum, told Cointelegraph. .

According to Tischhauser, crypto index ETFs are currently limited to BTC and ETH because they are the only digital assets that the Securities and Exchange Commission (SEC) has yet approved for inclusion in ETFs.

“They intend it to be an index, and as long as they only approve Bitcoin and Ethereum, that's what it's going to hold,” Tischhauser said. She added that demand for new single-asset ETFs like the Solana ( SOL ) ETF is limited.

Greyscale – the largest crypto fund issuer with $25 billion in assets under management (AUM) – has also expressed interest in entering into crypto index ETFs.

“We're going to see a lot more single assets and then some index-based and diversified products,” said Dave Lavalle, head of global ETFs at Grayscale, on Aug. 12.

Before an ETF can be traded on exchanges, the SEC must sign off on its registration application — called an S-1 — and at least one public stock exchange, such as Nasdaq, must allow it to list the product.

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