- Asset management firm Franklin Templeton has filed for approval of a spot Ethereum ETF, joining other major firms seeking first-mover advantage in bringing an SEC-approved Ether fund to market.
- Franklin Templeton’s proposed ETF would hold Ether tokens directly, allowing it to closely track Ethereum’s price movements – a model established by the first bitcoin ETF issuers.
- Approval of Ethereum ETFs could provide a significant boost to Ether’s price due to increasing investor demand, as seen in the bitcoin ETF market.
The race for regulatory approval of a spot Ethereum exchange-traded fund (ETF) has officially begun. Asset management titan Franklin Templeton has become the latest firm to file for a spot Ethereum ETF, joining the likes of Grayscale, Fidelity, and ARK Invest in seeking the lucrative first-mover advantage in bringing an SEC-approved fund to market. With bitcoin ETFs now trading in the US, an Ethereum fund seems the obvious next step.
Filing Follows Familiar Playbook Set by Bitcoin ETF Pioneers
Franklin Templeton filed for approval of the Franklin Ethereum Trust, structured as a Delaware statutory trust. The proposed ETF would hold Ether tokens directly, allowing it to closely track the cryptocurrency’s price movements. This follows the model established by the first bitcoin ETF issuers in their successful efforts to win SEC approval.
The flood of Ethereum ETF applications comes in anticipation of eventual approval, given the SEC’s warming stance toward crypto investment vehicles. However, regulators may take a more cautious approach to greenlighting an ether fund compared to bitcoin, which could mean a lengthy wait before launch.
Ethereum Price Could See Boost From ETF Trading
Ethereum saw only modest gains compared to bitcoin in the lead-up to the SEC approving the first bitcoin ETFs. Some analysts believe an approved Ethereum ETF could have an even greater impact on Ether’s price due to the relative immaturity of ether futures markets.
The launch of bitcoin ETFs last year kicked off a surge in trading volumes and inflows, demonstrating substantial pent-up investor demand. Early approved Ethereum ETFs could enjoy a similar popularity boost, creating positive price pressure on Ether.
Franklin Templeton’s ETF application is just the latest sign of the growing appetite among mainstream financial institutions to offer crypto exposure to their clients. As the blockchain industry continues to mature, more and more traditional asset managers seem ready to dip their toes into the crypto waters. While Ethereum ETF approval may still be months away, Franklin Templeton’s filing suggests the starting gun has been fired on the race to bring the first spot Ether fund to US investors.