Franklin Templeton’s Cryptocurrency Index ETF
Leading U.S. asset manager Franklin Templeton has submitted an application to the U.S. Securities and Exchange Commission (SEC) to launch a cryptocurrency index exchange-traded fund (ETF). This move underscores the increasing institutional interest in cryptocurrency ETFs, particularly those including assets such as Bitcoin.
Application for the Franklin Cryptocurrency Index ETF
On August 16, Franklin Templeton applied to launch the “Franklin Cryptocurrency Index ETF” to provide investors with diversified investments in multiple cryptocurrencies. Initially focusing on Bitcoin and Ethereum, the fund plans to include more assets in the future. The cryptocurrency index fund is designed to consist of weighted products allocated based on the market capitalization of the underlying assets, utilizing price data from the CME CF Bitcoin and Ethereum benchmark rates.
Institutional Interest in Cryptocurrency ETFs
Market experts have pointed out that institutions are increasingly showing interest in emerging industries, with data indicating a rise in the number of professional companies investing in cryptocurrency-related spot ETFs. During the second quarter, the number reached 1,199 institutional investors, signaling a growing trend towards diversified cryptocurrency investments.
Learn more: Cryptocurrency ETNs and Cryptocurrency ETFs: What’s the Difference?
While retail investors still dominate the market, institutional investors’ holdings have increased to 2.41% of assets under management (AUM). Companies such as Millennium and Susquehanna continue to be the largest holders of Bitcoin spot ETFs, with new entrants like Jane Street and Paul Tudor Jones making significant investments in Bitcoin ETFs during this period.
The Rise of Institutional Participation
As institutional participation in the cryptocurrency market grows, investment advisors now manage the largest AUM in the market. Research indicates that investment advisors and brokerage firms lead the way, with $4.7 billion and $1.5 billion in assets under management respectively. Hedge funds and holding companies closely follow, holding $3.8 billion and $1.1 billion, emphasizing the shift towards institutional involvement in the cryptocurrency space.
