Franklin Templeton has moved closer to launching two Bitcoin-focused exchange-traded funds after completing securities registrations for Nasdaq trading. The products will combine investments in major US companies with Bitcoin exposure funded through stock dividends. The development offers investors another way to gain cryptocurrency exposure without purchasing Bitcoin directly.
According to an October 22 SEC filing, the funds expect to trade under FBEQ and FIBT. However, Franklin Templeton has not announced their launch dates.
How the Bitcoin Dividend ETFs Will Operate
The Franklin US Equity Bitcoin DRIP Index ETF and Franklin US Innovation Bitcoin DRIP Index ETF will initially allocate 95% to equities and 5% to Bitcoin-related investments. The first fund will track 500 major US companies, while the second will target 100 innovation-focused businesses. Additionally, both funds will redirect regular and special stock dividends toward Bitcoin exposure.
Consequently, investors could benefit from potential gains across equities and Bitcoin through a single investment vehicle. However, cryptocurrency volatility could also increase investment risks.
Allocation Rules and Growing Crypto Ambitions
Franklin Templeton plans to charge an annual management fee of 0.09%. Besides, quarterly rebalancing will reduce Bitcoin allocations above 5% to 4.5%.
If Bitcoin exposure exceeds 20% between reviews, the funds will also apply corrective adjustments. Hence, these rules aim to limit excessive cryptocurrency concentration.
Moreover, the registrations build on Franklin Templeton’s broader digital asset expansion, including its tokenized money market fund, BENJI. The proposed ETFs could further connect traditional equity investing with cryptocurrency markets.
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