Franklin Templeton submitted an S-1 form to the U.S. Securities and Exchange Commission (SEC) on Monday, February 11, 2024, signalling its intent to issue an Ethereum exchange-traded product (ETF) to investors in the country.
The proposed ETF aims to closely track the price movements of Ethereum’s native token, Ether (ETH). Coinbase Custody, a division of Coinbase, will handle custody of the coins, and the Bank of New York Mellon will manage cash holdings for the ETF. Furthermore, should the SEC approve the application, the ETF shares will be listed and traded on the Cboe BZX Exchange.
The asset management firm now joins the ranks of eight other applicants seeking approval for spot Ethereum ETFs.
In January 2024, all eight applicants, which include VanEck, Ark 21 Shares, Hashdex, BlackRock, Fidelity Investments, Invesco, and Franklin Templeton, successfully launched spot Bitcoin ETFs after the securities regulator approved their applications. Notably, Grayscale has also applied to convert its Grayscale Ethereum Trust into a spot Ethereum ETF.
Since launching spot Bitcoin ETFs in the U.S., Franklin Templeton’s performance has been relatively modest compared to its competitors like BlackRock, Fidelity Investments, and Invesco. According to data from BitMEX Research, the asset manager’s ETF (EZBC) has not seen any significant inflow since January 11, when it saw an inflow of over $50.1 million. Since then, the fund saw its second-largest inflow of $5.1 million on February 7, 2024, as per the data.
With the SEC’s historical delays and rejections of spot Bitcoin ETFs, industry experts suggest a potential approval date for the Ether ETFs on May 23, 2024.
In another development, the regulator recently invited the public to to provide feedback on a proposed rule change that allows the listing and trading of Invesco Galaxy Ethereum ETF shares on the Cboe BZX Exchange. The regulator has stated that it requires further analysis and comments from the public to evaluate whether the proposed rule change is in line with the prevention of fraudulent and manipulative activities.
Ether (ETH) is currently trading at $2,666, marking a 3.49% increase in its 24-hour price, according to data from CoinMarketCap.
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