Franklin Templeton Files for Ethereum ETF as Competition Heats Up
Investment management firm Franklin Templeton announced on Monday that it has officially filed for a spot ethereum exchange-traded fund (ETF), marking its entry into the highly competitive market. With this move, Franklin Templeton becomes the eighth player vying to introduce a similar product.
The approval of 11 spot bitcoin ETFs by the U.S. Securities and Exchange Commission (SEC) in January marked a significant moment for the crypto industry, which had long been seeking regulatory approval for these products. A spot crypto ETF tracks the market price of the underlying digital asset, providing investors with exposure to the token without requiring them to purchase it.
Now, with Franklin’s registration, there are a total of eight ETF providers competing to introduce spot ether ETFs. All of these providers launched spot bitcoin products in January. However, while industry giant BlackRock and Fidelity have emerged as the top contenders in the spot bitcoin ETF race, with assets of $4.18 billion and $3.49 billion, respectively, Franklin Templeton lags behind. According to BitMEX Research, Franklin’s ETF currently has only $77 million in assets. In contrast, seven out of the nine newly launched spot bitcoin ETFs now boast assets exceeding $100 million.
Despite its relatively low assets under management, the veteran asset management firm, founded in 1947, is determined to make its mark in the field. Franklin Templeton has allocated resources towards marketing its spot bitcoin ETF through Google ads.
Meanwhile, the SEC recently delayed its decision on an application by crypto asset manager Grayscale Investments to convert its ethereum trust product into a spot ETF. Similarly, market regulator has postponed BlackRock’s application to launch a similar product. The first filing for a spot ethereum ETF was submitted by VanEck, and the SEC must make a decision on the application by May 23.
Should the proposed ETF be approved, Coinbase Custody, a unit of popular crypto exchange Coinbase, will act as the custodian for the ETF’s ether holdings. Notably, Coinbase Custody is also the proposed custodian for BlackRock’s ethereum ETF.
As competition intensifies in the crypto ETF market, it remains to be seen which players will ultimately secure regulatory approval and take the lead in offering investors exposure to these digital assets.
Analyst comment
Positive news: Franklin Templeton Files for Ethereum ETF as Competition Heats Up
Analyst view: The entry of Franklin Templeton into the spot ethereum ETF market adds more competition. While Franklin Templeton lags behind in assets, their determination and marketing efforts show their commitment. The decision on VanEck’s proposed ETF by May 23 and the involvement of Coinbase Custody as a custodian are factors to watch. Overall, the market for spot ethereum ETFs is expected to become more competitive as players vie for regulatory approval and offer investors exposure to digital assets.