Franklin Templeton Registers Two Bitcoin DRIP ETFs on Nasdaq

Asset manager Franklin Templeton has moved closer to launching two Bitcoin dividend reinvestment exchange-traded funds after completing securities registration for Nasdaq trading under the proposed tickers FBEQ and FIBT, according to CryptoNews.

Fund Structure and Allocation Strategy

According to an October 22 SEC filing, the Franklin US Equity Bitcoin DRIP Index ETF and the Franklin US Innovation Bitcoin DRIP Index ETF have completed their registration under Section 12(b) of the Securities Exchange Act of 1934. The filing did not specify a precise launch date.

Both funds will initially allocate 95% of their portfolios to US equities and 5% to Bitcoin investments. The equity holdings will draw from separate indexes developed by VettaFi, with the equity Bitcoin DRIP fund tracking the VettaFi US Large-Cap 500 Bitcoin DRIP Index, and the innovation-focused fund tracking 100 large US companies from a Nasdaq stock universe.

Dividend Reinvestment and Rebalancing Rules

Rather than distributing Bitcoin directly, the funds will direct regular and special dividends paid by the underlying stocks toward accumulating Bitcoin exposure on the business day following the relevant ex-dividend date. Investors will hold shares whose values depend on the performance of both underlying equities and eligible Bitcoin investment products.

To control Bitcoin exposure, the funds will enforce quarterly rebalancing to reduce allocations above 5% back down to 4.5%. Additionally, if Bitcoin exposure exceeds 20% between scheduled reviews, the allocation must be reduced to 4.5% by the close of the second business day following the breach. Both ETFs carry an annual management fee of 0.09%.

Key facts

• Franklin Templeton registered two Bitcoin DRIP ETFs under the tickers FBEQ and FIBT following an October 22 SEC filing.
• The funds will initially allocate 95% to US equities and 5% to Bitcoin investments, using stock dividends to build BTC exposure.
• Quarterly rebalancing will reduce Bitcoin allocations above 5% down to 4.5%, with a hard cap rule at 20%.
• Both ETFs will charge an annual management fee of 0.09% and track VettaFi-developed indexes.