Franklin Templeton Submits Application for Spot Bitcoin ETF to SEC, Aligning with Wall Street Competitors

Franklin Templeton, a major asset management firm with an impressive $1.5 trillion in assets under management, has entered the race for approval of a spot Bitcoin exchange-traded fund (ETF). The firm has recently filed a request with the U.S. Securities and Exchange Commission (SEC), indicating its intention to introduce the Franklin Bitcoin ETF on the Cboe BZX Exchange.

In the submitted Form S-1, Franklin Templeton disclosed that Coinbase, a well-known publicly traded entity, would act as its brokerage partner and custodian for Bitcoin (BTC). Additionally, the firm has suggested the Bank of New York Mellon to manage the fund’s cash reserves.

Franklin Templeton now joins the ranks of Wall Street powerhouses such as BlackRock and Fidelity, all of which have sought spot Bitcoin ETFs. These financial products would enable U.S. investors to engage directly with Bitcoin without the necessity of holding the digital currency, thereby facilitating access to cryptocurrency markets.

Nonetheless, the SEC has historically rejected applications for spot Bitcoin ETFs due to apprehensions regarding potential market manipulation. Notably, the regulatory agency has approved Bitcoin futures ETFs, a decision that has puzzled both cryptocurrency supporters and the legal community.

In a legal challenge against the SEC, a panel of judges deemed the commission’s rejection of Grayscale’s request to convert the GBTC fund into a spot Bitcoin ETF as “arbitrary and capricious.” Judge Neomi Rao specifically noted that the SEC failed to adequately justify its inconsistent treatment of similar products, particularly in light of the approval of futures ETFs.

It is crucial to note that this ruling does not automatically authorize Grayscale’s efforts to establish a spot Bitcoin ETF. The SEC is now required to reassess Grayscale’s application and either grant approval or provide new reasons for denial or postponement.

During a recent U.S. Senate hearing, SEC Chair Gary Gensler was questioned about the Grayscale ruling and the commission’s standards for approving a spot Bitcoin ETF. Gensler replied, indicating, “We’re reviewing that decision. There are multiple spot ETP filings that we’re also reviewing, and I’m looking forward to the staff’s recommendations.”

Gensler was clear about the digital asset sector’s compliance, stressing “wide-ranging non-compliance” in his written testimony prior to the hearing. He reiterated this stance when speaking to policymakers during the session.

At present, there are more than a dozen Bitcoin ETF applications from various issuers pending the SEC’s decision. These include proposals for both spot Ethereum and Ethereum futures funds, highlighting the increasing demand for regulated cryptocurrency investment options in the United States. The crypto community is keenly anticipating the SEC’s position on these applications and the possible transformation of the cryptocurrency investment landscape.

The post Franklin Templeton Files for Spot Bitcoin ETF with SEC, Joining Wall Street Peers appeared first on BitcoinWorld.