Franklin Templeton launches index ETFs for Bitcoin and Ether

Franklin Templeton has introduced a new cryptocurrency exchange-traded fund (ETF), making it the second crypto index ETF to launch in the United States.

On February 20, the asset management firm announced the debut of the Franklin Crypto Index ETF (EZPZ), an ETF that provides exposure to both spot Bitcoin (BTC) and Ether (ETH). The launch follows the introduction of the Nasdaq Crypto Index US ETF (NCIQ) by asset manager Hashdex on February 14, marking the increasing mainstream adoption of crypto-based investment products.

Franklin Templeton’s EZPZ fund is based on the US CF Institutional Digital Asset Index, which currently tracks only Bitcoin and Ether as of February 20. The index is weighted by market capitalization, with approximately 87% allocated to BTC and 13% to ETH, according to CF Benchmarks. 

This structure provides investors with a diversified yet simple exposure to the two largest cryptocurrencies by market value, allowing for a more balanced and less volatile investment compared to individual asset holdings.

Franklin Templeton has indicated that EZPZ will expand to include additional digital assets as they are incorporated into the underlying index.

The long-term goal is to establish the ETF as a one-stop-shop crypto portfolio for US investors, catering to those who want diversified exposure to the crypto market without the complexities of direct asset purchases. 

In a post on X (formerly Twitter), Franklin Templeton emphasized that the ETF allows investors to gain exposure to Bitcoin and Ether “without the hassle of buying them directly.”

The asset manager further stated: “This innovative offering plans to add new digital assets as they become eligible for inclusion in the Underlying Index, pending necessary regulatory approvals.”

Similarly, Hashdex’s NCIQ fund also plans to expand beyond BTC and ETH as regulatory approvals permit.

The launch of these cryptocurrency index ETFs signals a growing acceptance of digital asset investments in the traditional financial sector. The US Securities and Exchange Commission (SEC) approved both Franklin Templeton’s EZPZ and Hashdex’s NCIQ on December 19. 

While EZPZ is listed on Cboe BZX, NCIQ is traded on the Nasdaq stock exchange.

This regulatory shift comes amid a changing political and economic climate in the US. Following Donald Trump’s electoral victory and his official swearing-in on January 20, the US government appears to be adopting a more favorable stance toward cryptocurrency regulation. 

Trump has publicly stated his intention to transform the US into the “world’s crypto capital,” signaling potential policy shifts that could encourage greater institutional participation in digital assets.

With increasing institutional demand for regulated crypto investment products, asset managers have been actively submitting applications to launch ETFs featuring alternative cryptocurrencies (altcoins).

 In 2024, numerous firms filed regulatory requests to introduce ETFs tracking digital assets such as Solana (SOL), XRP, and Litecoin (LTC), among others.

Additionally, in October 2023, NYSE Arca, a leading securities exchange, filed a request with US regulators to list a Grayscale ETF that would hold a diversified basket of spot cryptocurrencies. Grayscale’s Digital Large Cap Fund, originally established in 2018, holds Bitcoin, Ether, Solana, XRP, and other major digital assets. 

However, it has yet to transition into an exchange-traded fund. If approved, it would represent another major milestone in bridging traditional finance with the crypto industry.