Franklin Templeton has filed to launch two exchange-traded funds that would automatically direct stock dividend income into Bitcoin exposure.
Summary
- Franklin Templeton has filed for two ETFs that would reinvest stock dividends into Bitcoin exposure through a rules based allocation strategy.
- The proposed funds would start with a 95% allocation to U.S. large cap equities and a 5% allocation to Bitcoin linked investments.
- The filing extends Franklin Templeton’s digital asset expansion after recent tokenization partnerships with Kraken, MoonPay, and Ondo Finance.
A registration filing submitted on Thursday shows the asset manager has proposed the Franklin US Equity Bitcoin DRIP Index ETF and the Franklin US Innovation Bitcoin DRIP Index ETF, with an anticipated effective date of Sept. 1, 2026.
The products would track the VettaFi US Large-Cap 500 Bitcoin DRIP Index and a related innovation-focused version. Under the index methodology, dividends generated by the underlying stock portfolios would be reinvested into Bitcoin-linked investments rather than remaining in cash or being distributed to investors.
The filing states that Bitcoin exposure could come through spot Bitcoin exchange-traded products, futures contracts, options, or other investment instruments. The strategy is scheduled to begin with a portfolio allocation of 95% U.S. large-cap equities and 5% Bitcoin exposure.
Quarterly rebalancing rules would reduce Bitcoin allocations above 5% back to 4.5%, while a separate cap would limit Bitcoin exposure to 20% between rebalancing periods, the filing states.
As of April 30, the equity index included approximately 498 securities. The filing states that constituent companies ranged in market capitalization from roughly $7.5 billion to $4.9 trillion.
Franklin expands crypto-linked investment offerings
The proposed ETFs add another product category to Franklin Templeton’s digital asset business, which already includes spot cryptocurrency ETFs, tokenized funds, and blockchain-based investment products.
Data from SoSoValue showed Franklin Templeton’s spot Bitcoin ETF, EZBC, held $358.9 million in net assets and had attracted $329.6 million in cumulative net inflows as of Thursday.
Source: SoSoValue.
The filing follows several digital asset initiatives announced by the firm in recent months. On June 15, Franklin Templeton said it would work with Ondo Finance to offer tokenized versions of its ETFs that can trade directly from crypto wallets on a 24/7 basis. The products target investors outside the United States and include exposure to U.S. equities, fixed income assets, and gold.
Earlier in June, Franklin Templeton integrated its BENJI tokenized money market fund into MoonPay Trade. The partnership allows institutional clients to exchange stablecoins such as USDC and USDT for BENJI through MoonPay’s on-chain trading infrastructure.
In May, Franklin Templeton announced a separate partnership with Payward, the parent company of crypto exchange Kraken. The companies said BENJI would be available on Kraken’s platform as a collateral and cash management product for institutional users. They also disclosed plans to develop additional tokenized investment products through Payward’s xStocks infrastructure.
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