Summary:

Franklin Templeton, a leading asset management firm, has submitted an application to the U.S. Securities and Exchange Commission (SEC) to establish a Bitcoin exchange-traded fund (ETF) that would track the price of Bitcoin in real-time. This comes after the SEC’s decision to delay the approval of other spot ETF applications. In its application, Franklin Templeton outlines the fund’s structure, with Coinbase serving as the custodian for Bitcoin holdings and Bank of New York Mellon as the cash custodian and administrator. The SEC is expected to make a decision on the application by October 16th.

Franklin Templeton’s ETF Application

Franklin Templeton has applied to the SEC to launch a Bitcoin ETF that would track the price of Bitcoin in real-time. The firm plans to structure the ETF as a trust, with Coinbase serving as the custodian for Bitcoin holdings. Bank of New York Mellon will act as the cash custodian and administrator. The ETF’s shares are intended to be traded on the Cboe BZX Exchange. The SEC has set a deadline of October 16th to make a decision on the application.

Partnership with CF Benchmarks

To ensure accurate valuations, Franklin Templeton plans to collaborate with CF Benchmarks, a regulated digital asset index provider based in the U.K. CF Benchmarks will provide daily valuations based on data from reputable cryptocurrency exchanges, such as Coinbase, Bitstamp, Kraken, and Gemini. These valuations will be updated at 5-minute intervals to reflect the real-time nature of the cryptocurrency market.

FAQ

What is a Bitcoin ETF?

A Bitcoin exchange-traded fund (ETF) allows investors to gain exposure to the price of Bitcoin without owning the underlying asset. It is traded on traditional stock exchanges, making it easier for investors to buy and sell compared to directly purchasing and holding Bitcoin.

Why is Franklin Templeton launching a Bitcoin ETF?

Franklin Templeton is launching a Bitcoin ETF to meet the growing demand for cryptocurrency investments. The firm aims to provide investors with a regulated and accessible way to invest in Bitcoin.

What is the SEC’s role in approving a Bitcoin ETF?

The U.S. Securities and Exchange Commission (SEC) is responsible for reviewing and approving applications for exchange-traded funds. The SEC evaluates factors such as investor protection, market manipulation, and liquidity before granting approval.

When will the SEC make a decision on Franklin Templeton’s application?

The SEC has set a deadline of October 16th to make a decision on Franklin Templeton’s application for a Bitcoin ETF.

What risks does Franklin Templeton acknowledge in its application?

Franklin Templeton recognizes the regulatory uncertainties surrounding the digital asset market in the United States. They highlight the potential adverse impacts of legislative or regulatory developments, which could significantly affect the value of Bitcoin and the shares of the proposed ETF. These impacts could include bans, restrictions, or imposing stringent conditions on various aspects of the cryptocurrency ecosystem.