Franklin Templeton, a multinational asset manager, has filed an amended S-1 application with the SEC for its Franklin Crypto Index ETF, seeking permission to expand the fund's holdings beyond Bitcoin and Ethereum. The filing, submitted on Thursday, January 25, 2025, outlines the initial weighting of the ETF as 86.31% Bitcoin (BTC) and 13.69% Ethereum (ETH).
While the filing doesn't commit to adding other cryptocurrencies, it leaves the door open for future expansion, stating that the inclusion of additional digital assets would be contingent on SEC approval for exchange-traded products or funds for those specific tokens. This approach suggests a potential for the ETF to diversify its holdings in the future, subject to regulatory oversight.
Franklin Templeton already has a Bitcoin ETF and an Ethereum ETF, both of which gained SEC approval in January 2024. The Bitcoin ETF currently holds $743.7 million, while the Ethereum ETF has a value of $33.9 million. If approved, the Franklin Crypto Index ETF will be listed on the Cboe BZX Exchange.
The potential approval of a multi-asset crypto ETF has generated significant interest, with industry experts like Jeff Hancock, CEO and co-founder of Coinpass, describing it as a "big breakthrough." He believes that such an ETF would provide institutional and individual investors with a less correlated way to gain exposure to digital assets, while also bringing "much-needed liquidity" to the market.
The SEC has previously granted accelerated approval to Franklin Templeton's initial application for the fund, which was focused solely on Bitcoin and Ethereum. The regulator also took similar action for the Bitwise Bitcoin and Ethereum ETF in January 2025.
The filing comes amid a surge in crypto ETF applications, with firms like Bitwise and Grayscale submitting proposals for Dogecoin ETFs in January 2025. Additionally, four firms have filed for XRP ETFs in the past 24 hours. This increased activity is attributed to the appointment of Paul Atkins, a pro-crypto advocate, as the new chair of the SEC.
Cryptocurrency analyst Glen Goodman believes that the Franklin Crypto Index ETF will receive SEC approval and that Atkins' leadership will make it easier for crypto-focused investment vehicles to gain regulatory approval. He describes Atkins as "about as pro-crypto as the industry could hope for."