• Franklin Templeton has proposed a Bitcoin and Ethereum index ETF that would combine the two assets in one fund.

  • Hashdex plans to launch a groundbreaking ETF that directly holds spot Bitcoin and Ethereum.

In a notable development, Franklin Templeton Investments, a prominent trillion-dollar asset management firm, has submitted a proposal to the United States Securities and Exchange Commission (SEC) to establish a Bitcoin [BTC] and Ethereum [ETH] index exchange-traded fund (ETF).

If approved, the move would allow the global investment firm to combine BTC and ETH into a single fund, offering investors a streamlined way to gain exposure to both digital assets.

The proposed ETF would include bitcoin, ethereum and cash equivalents — short-term securities maturing in less than three months — allowing investors to participate in the cryptocurrencies without directly owning them.

Curiously, this proposal comes at a time when the entire BTC ETF recorded outflows of $52.9 million, while the ETH ETF saw inflows of $19.8 million, according to Farside Investors;

How will it affect the cryptocurrency market?

That being said, Franklin Templeton’s proposed Bitcoin and Ethereum crypto index ETF would mark the first-ever fund to combine BTC and ETH in a single index product.

According to the filing, the ETF aims to simplify the investment process for both institutional and retail investors by providing them with streamlined access to the two largest cryptocurrencies by market capitalization.

In this regard, a user X said:

As expected, this step will also ease the complexity and volatility that often occur with cryptocurrency exchanges.

what else?

The fund will be structured in blocks of 50,000 shares and priced based on the net asset value (NAV) of the underlying bitcoin and ethereum.

Notably, the ETF will not use its digital assets for staking or other income-generating activities, maintaining a simple approach to crypto investing.

To provide further insights, the paper states;

“CSC Delaware Trust Company, a subsidiary of Corporate Services Corporation, is the trustee (the “Trustee”). Bank of New York Mellon is the custodian of the Fund’s cash and cash equivalents16 (the “Cash Custodian”) and the administrator and transfer agent for the Fund (the “Administrator” or “Transfer Agent”);

It further added:;

Coinbase Custody Trust (the “Digital Custodian”) will be responsible for custody of the Fund’s Bitcoin and Ethereum. According to the registration statement, each share will represent an undivided beneficial interest in a fraction of the Fund’s net assets. ”;

However, the fund’s final approval is subject to an evaluation by the SEC, particularly with regard to anti-fraud measures.

For context, the SEC typically approves cryptocurrency ETFs only after confirming that there are strong safeguards in place to prevent fraud and market manipulation in regulated futures markets.

Hashdex’s Crypto Index ETF Proposal

Well, Franklin Templeton wasn’t the only one in July, Hashdex, a prominent crypto asset manager, also made significant progress in launching a groundbreaking ETF that would directly hold spot BTC and ETH.

The company also filed an S-1 registration statement with the SEC, positioning the Hashdex Nasdaq Crypto Index US ETF as a potential game-changer for the U.S. market;