Franklin Templeton’s Application for Cryptocurrency Index ETF
Leading U.S. asset manager Franklin Templeton has recently submitted an application to the U.S. Securities and Exchange Commission (SEC) to launch a cryptocurrency index exchange-traded fund (ETF). This move signifies the increasing interest of institutions in cryptocurrency ETFs, particularly those incorporating assets like Bitcoin.
The Franklin Cryptocurrency Index ETF: A Diversified Investment Opportunity
Franklin Templeton’s application, filed on August 16, aims to introduce the “Franklin Cryptocurrency Index ETF” to offer investors a diversified portfolio of multiple cryptocurrencies. Initially focusing on Bitcoin and Ethereum, the fund plans to expand to include more assets in the future.
According to the filing, the cryptocurrency index fund will be comprised of weighted products allocated based on the market capitalization of the underlying assets. The index will derive price data from the CME CF Bitcoin and Ethereum benchmark rates.
Institutional Interest in Cryptocurrency ETFs on the Rise
Market experts have observed a growing trend of institutional interest in emerging industries like cryptocurrency. Data from K33 Research senior analyst Betl Lunde reveals that the number of professional companies investing in cryptocurrency-related spot ETFs surged by 262 in the second quarter, reaching 1,199 institutional investors.
Despite retail investors still dominating the market, institutional investors’ holdings have increased to 2.41% of assets under management (AUM). Major players like Millennium and Susquehanna continue to hold significant amounts of Bitcoin spot ETFs. Additionally, new entrants such as Jane Street and Paul Tudor Jones have made notable investments in Bitcoin ETFs.
The Growing Presence of Institutional Investors in the Cryptocurrency Market
As institutional participation continues to grow, James Butterfill, head of research at CoinShares, highlights that investment advisors now manage the largest AUM in the market. Investment advisors and brokerage firms lead the way with $4.7 billion and $1.5 billion in assets under management, respectively, followed closely by hedge funds and holding companies with $3.8 billion and $1.1 billion, respectively.
