Franklin Templeton Introduces Ethereum ETF; Awaits SEC Approval
Summary:
Asset management firm Franklin Templeton has launched its Ethereum exchange-traded fund (ETF), now listed on the Depository Trust and Clearing Corporation website. The S-1 filing for the ETF's approval still awaits decision from the U.S. Securities and Exchange Commission. The firm's entry into the Ethereum ETF market follows similar moves by other industry giants like BlackRock, Grayscale, VanEck, and ARK Invest. The SEC's stance on Ether's classification as a security is being closely watched as it could influence the approval process.
Franklin Templeton, a asset management company, has introduced its new Ethereum exchange-traded fund (ETF), known as the "Franklin Ethereum TR Ethereum ETF", identified by the code EZET. It is now listed on the website of the Depository Trust and Clearing Corporation, a prime securities transaction platform in the U.S. The ETF is available for creation and redemption, according to the website's create/redeem column. This feature of ETFs is key as it allows the adjustment of the ETF share supply depending on the demand, which helps maintain the market price of the ETF near its net asset value.
Just because the Franklin Templeton Ethereum spot ETF is listed on the DTCC website, that doesn't necessarily mean that the S-1 filing for a spot Ether ETF submitted to the U.S. Securities and Exchange Commission (SEC) has gained approval. The DTCC website is known to list securities fit for trading and settlement within its systems and these can include ETFs that have fulfilled specific registration or compliance procedures. Nevertheless, SEC determines the approval status of an ETF filing based on various regulatory standards and considerations.
The asset management company, which handles assets worth 1.5 trillion dollars, submitted its S-1 filing to the U.S. Securities Exchange Commission on February 12 for a spot Ether (ETH) ETF. If approved, it would be listed on the Chicago Board Options Exchange as the "Franklin Ethereum ETF".
The SEC delayed the final decision on Franklin Templeton’s Ethereum spot ETF proposal on April 23. The SEC declared that it has extended the review period for the proposed rule change for listing and trading Franklin Ethereum Trust shares on the Cboe BZX Exchange. Now, the commission has until June 11 to make their evaluation, providing an extra 45 days.
The listing of the Ethereum spot ETF of Franklin Templeton on the website of the Depository Trust and Clearing Corporation puts Franklin Templeton on par with other industry heavyweights like BlackRock, Grayscale, VanEck, and ARK Invest, who have all joined the Ethereum ETF race. However, prediction for Ethereum-based funds is not the same as their Bitcoin equivalents. Bloomberg ETF analyst, Eric Balchunas, earlier estimated that the odds of the SEC giving approval for a spot Ether ETF in May at around 35% in March. He cited the less proactive approach of the regulator compared to the Bitcoin ETF approval process. He also stated that SEC Chair Gary Gensler’s viewpoint on Ether could influence the decision-making process, given that Gensler has refrained from stating whether Ether is a security.
Published At
4/27/2024 1:25:19 PM
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