Crypto Revolution Delayed: SEC Pushes Decision on Franklin Templeton’s Bitcoin-Ethereum ETF to 2025
The U.S. Securities and Exchange Commission (SEC) has once again delayed its decision on Franklin Templeton’s proposed Bitcoin-Ethereum ETF, moving the deadline to January 6, 2025. The proposed ETF, which aims to offer combined exposure to Bitcoin and Ethereum, would trade on the Cboe BZX Exchange under the ticker “EZPZ” and would use Coinbase Custody Trust Company LLC as the custodian for its digital assets.
A New Type of Crypto ETF
Franklin Templeton’s ETF proposal stands out as a hybrid product, providing investors with exposure to the two largest cryptocurrencies in a single investment vehicle. The design appeals to those seeking to bypass the complexities of managing direct crypto holdings, offering a simplified entry point into the crypto market.
Since its filing in August 2024, the proposal has generated substantial interest. Despite a public comment period with no significant opposition, the SEC opted to delay its decision, underscoring the regulatory body’s cautious approach toward crypto-backed financial products.
Broader Implications for the Crypto Industry
Franklin Templeton isn’t the only major player seeking an ETF approval. Bitwise has submitted its own proposal to convert its $1.3 billion crypto index fund into a publicly traded ETF. Bitwise’s proposed ETF would allocate 75% of its holdings to Bitcoin and 16% to Ethereum, emphasizing the dominance of these two assets in the market.
Analysts believe that approval of either Franklin Templeton’s or Bitwise’s proposal could be a game-changer for institutional adoption of crypto. Much like the rise of index funds in traditional finance, these ETFs could bridge the gap between traditional finance (TradFi) and digital finance (DeFi), providing institutional investors and retail participants with easier access to Bitcoin and Ethereum.
Franklin Templeton’s Commitment to Blockchain
While awaiting the SEC’s decision, Franklin Templeton has not stood idle. In 2024, the firm expanded its blockchain strategy by integrating its Benji tokenization platform with Ethereum. This move complements its existing partnerships with other blockchains, including Aptos, Avalanche, Arbitrum, and Base.
These blockchain initiatives highlight Franklin Templeton’s commitment to using distributed ledger technology (DLT) to modernize traditional finance. By tokenizing financial products and supporting multiple blockchain networks, the firm is positioning itself as a forward-thinking leader in blockchain-enabled finance.
What’s at Stake for the Crypto Market?
The SEC’s decision to delay Franklin Templeton’s ETF approval adds to a growing list of postponed rulings for crypto-based financial products. The broader crypto market remains optimistic, however, as total market capitalization continues to rise amid renewed investor interest. Analysts believe that regulatory clarity for ETFs could accelerate institutional adoption and cement crypto as a core component of mainstream financial portfolios.
The SEC’s extended review period comes at a time when spot Bitcoin ETFs, such as BlackRock’s iShares Bitcoin Trust (IBIT), have already begun trading and capturing significant market share. With Franklin Templeton’s proposed ETF aiming to combine Bitcoin and Ethereum, the product could offer unique diversification benefits, setting it apart from other offerings.
Looking Ahead: The 2025 Decision Date
With the new deadline set for January 6, 2025, all eyes are on the SEC as it deliberates. Approval of Franklin Templeton’s ETF could mark a major turning point, potentially paving the way for more diversified crypto ETFs that provide exposure to multiple digital assets. Industry watchers are particularly interested in how the SEC’s decision could shape the future of DeFi, TradFi, and the broader regulatory landscape for digital finance.
The SEC’s decision to delay its ruling on Franklin Templeton’s Bitcoin-Ethereum ETF reflects the ongoing regulatory uncertainty surrounding crypto investment products. If approved, the ETF could unlock new pathways for traditional finance to access the crypto sector, similar to how index funds reshaped stock market investment. With Franklin Templeton’s broader blockchain initiatives and Bitwise’s competing proposal also in play, the future of multi-asset crypto ETFs could be closer than ever. The industry now awaits the SEC’s decision in early 2025, which could serve as a pivotal moment for the crypto sector’s integration into mainstream finance.