Franklin Templeton became the latest asset manager to apply for a spot Ethereum exchange-traded fund (ETF) with a filing on February 12.
The company detailed its plans in an S-1 registration statement filed with the Securities and Exchange Commission (SEC). As with other similar offerings, the fund will issue shares representing assets, primarily Ethereum (ETH), which will be held by the custodian on behalf of the fund. The fund also aims to mirror the price performance of ETH.
Franklin Templeton appointed Coinbase Custody as its cryptocurrency custodian and Bank of New York Mellon as its cash custodian, custodian and remittance agent.
This offering only allows cash creation and redemption, as opposed to spot creation and redemption, which allows certain participants to trade cryptocurrencies. It also explains how potential Ethereum staking rewards may be treated as income for the Fund. Competing applicants Ark Invest and 21Shares also addressed these issues in their amended filings on February 7.
Data from Bloomberg ETF analyst James Seyffart I suggest the following: Franklin Templeton is the ninth asset manager to apply for a spot Ethereum ETF. Separately, the company’s Franklin Bitcoin ETF (EZBC) was one of several spot Bitcoin ETFs approved in January.
SEC Should Decide on VanEck’s ETH ETF in May
The SEC must decide to approve or deny VanEck’s application for a competing spot Ethereum ETF by May 23, 2023, without further delaying its decision. The brokerage firm is likely to decide on several similar applications with similar content at that time.
One Polymarket prediction market predicts a 48% chance that a spot Ethereum ETF will be approved in May. James Seyffart expects a 60% chance of approval in May, while JP Morgan analyst Nikolaos Panigirtzoglou expects a 50% chance of approval in May.
Standard Chartered believes a spot Ethereum ETF will be approved in May, while TD Cowen does not expect this type of fund to be approved until 2025 or 2026.
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