Posted: February 13, 2024 2:33 AM Updated: February 13, 2024 2:33 AM
Correction and fact check date: February 13, 2024, 2:33 AM
briefly
Franklin Templeton has filed a Form S-1 with the US SEC for a spot Ethereum ETF, joining eight asset managers aiming to launch similar products.
Investment management firm Franklin Templeton has filed an application for a spot Ethereum exchange-traded fund (ETF) with the U.S. Securities and Exchange Commission (SEC). Franklin Templeton is one of eight ETF providers currently aiming to launch a spot Ethereum ETF. All eight competitors previously launched spot Bitcoin products in January.
The company filed an S-1 registration statement for the Franklin Ethereum ETF, outlining plans for the fund to closely mirror the price movements of ETH, Ethereum’s native cryptocurrency. Upon disposition of the assets, Coinbase Custody Trust Company will be established as custodian of ETH, and Bank of New York Mellon will oversee cash holdings.
If approved, the ETF’s shares will be listed and traded on the Cboe BZX Exchange.
According to information provided in Franklin Templeton’s filing, “authorized participants” who are permitted to participate in the creation and redemption of shares will use only cash transactions.
Additionally, the filing states, “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 affiliates of the sponsor. In return for staking activities in which the Fund may engage, the Fund will receive certain staking rewards in Ether tokens, which may be treated as income of the Fund.”
In the latest move, Franklin Templeton joins other investment management firms including Ark Invest, 21Shares, Grayscale Investments and BlackRock. These companies have all submitted applications for spot Ethereum ETFs over the past few months.
Notably, Ark Invest and 21Shares recently updated the registration statements for their potential spot Ethereum ETFs by incorporating cash creation and redemption along with a new staking component. Franklin Templeton’s filing aligns with this trend, opting for cash trading and also including staking in its approach.
Spot Ethereum ETF decision delayed sparks expert speculation
The SEC postponed decisions on several Ethereum ETF applications in January, including those from Grayscale Investments, Fidelity, BlackRock, and Invesco Galaxy. This has led analysts to have mixed expectations about the likelihood of approval for the product this year. However, some are expecting approval in May.
Recently, Cathie Wood, CEO and Chief Information Officer of ARK Invest, expressed skepticism about the SEC approving spot ETFs for cryptocurrencies other than Bitcoin and Ethereum. “I would be surprised if any currency other than Bitcoin and Ethereum gets SEC approval,” she told the Wall Street Journal.
Franklin Templeton’s entry into the Ethereum ETF space and industry-wide trends signal a dynamic shift in the cryptocurrency investment landscape, reflecting evolving strategies and growing expectations despite regulatory uncertainty.
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Alisa is a reporter for Metaverse Post. She focuses on everything related to investing, AI, metaverse, and Web3. Alisa holds a degree in Art Business and her expertise lies in the fields of art and technology. She developed a passion for journalism through her work with VCs, notable cryptocurrency projects, and science writing. You can contact us at (email protected).
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alice davidson
Alisa is a reporter for Metaverse Post. She focuses on everything related to investing, AI, metaverse, and Web3. Alisa holds a degree in Art Business and her expertise lies in the fields of art and technology. She developed a passion for journalism through her work with VCs, notable cryptocurrency projects, and science writing. You can contact us at (email protected).
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