Kategorie: Bitcoin News

• Franklin Templeton joins other asset management firms like Grayscale that have applied to offer crypto ETFs.
• The SEC was mandated by the court to evaluate Grayscale’s application to convert its Bitcoin futures ETF into a spot ETF.
• Franklin Templeton will collaborate with CF Benchmarks to ensure accurate valuation.

Franklin Templeton, a prominent asset management firm with $1.5 trillion in assets under management, has submitted an application to the United States Securities and Exchange Commission (SEC) seeking approval for the launch of a Bitcoin exchange-traded fund (ETF) that would track the price of Bitcoin in real-time.

This move by Franklin Templeton follows a series of notable developments in the cryptocurrency ETF space. In late August, the SEC opted to delay its decisions regarding spot ETF applications from several other companies, including WisdomTree, Valkyrie, Fidelity, VanEck, Bitwise, and Invesco. Furthermore, a significant court ruling on August 29th mandated that the SEC must evaluate Grayscale’s application to convert its Bitcoin futures ETF into a spot ETF.

Franklin Templeton’s ETF application

In their application, Franklin Templeton outlines the structure of the proposed fund. It would function as a trust, with Coinbase serving as the custodian for Bitcoin holdings. Bank of New York Mellon would take on the roles of cash custodian and administrator. Fund shares are intended to be traded on the Cboe BZX Exchange, a major securities exchange in the United States. The SEC has set its next deadline for making a decision on this application for October 16th.

In recognition of the regulatory uncertainties surrounding the digital asset market in the United States, Franklin Templeton explicitly acknowledges the risks in its application. They highlight the potential adverse impacts of legislative or regulatory developments, which could significantly affect the value of Bitcoin and the shares of the proposed ETF. Such impacts could include bans, restrictions, or imposing stringent conditions on various aspects of the cryptocurrency ecosystem, including trading, mining, digital wallets, custody services, and the overall operation of the Bitcoin network.

CF Benchmarks and Franklin Templeton partnership

To ensure accurate valuations, Franklin Templeton plans to collaborate with CF Benchmarks, a digital asset index provider regulated in the United Kingdom. CF Benchmarks would provide daily valuations based on data from reputable cryptocurrency exchanges, including Coinbase, Bitstamp, iBit, Kraken, Gemini, and LMAX Digital. These valuations would be updated at 5-minute intervals to reflect the real-time nature of the cryptocurrency market.

At the time of writing, the price of Bitcoin was trading at $25,952.26, underlining the dynamic and ever-changing nature of the digital asset market that Franklin Templeton seeks to tap into with its proposed Bitcoin ETF.

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• Crypto is getting more and more institutionalised and maturing well, says Mohamed El-Erian.
• The top economist pointed to the flip in sentiment from major players such as BlackRock as good for crypto.
• El-Erian also commented on US inflation.

Mohamed El-Erian, the chief economic advisor at Allianz, says the cryptocurrency industry is getting more institutionalized and maturing well. The economist and president of Queen’s College, Cambridge, shared the outlook during an interview with CNBC’s “Squawk Box” show on Tuesday.

His comments also came as Bitcoin bounced off lows seen on Monday to trade above $26,000 as the broader market awaits the latest on US inflation. BTC was also up as asset manager Franklin Templeton filed for a spot bitcoin ETF to add to those of BlackRock, Fidelity and others.

Crypto becoming part of global ecosystem

According to El-Erian, the growing embrace of crypto by big mainstream players can only be good for the sector even amid the wider scope of Fed’s rates path.

“Crypto is settling as part of the ecosystem. People have recognized it’s not the new global currency. People have also realized it’s not going to disappear tomorrow. It’s been institutionalized. If I were a crypto person, this maturation process is a good thing,” he told CNBC.

The investor also noted that headline inflation is likely to “prove much more complicated”, with core inflation less well behaved amid the Fed’s battle to bring it to its desired 2% level. 

In his opinion, the market may have to absorb the notion that the trajectory is “higher for longer.” He also thinks that the assumption is that the Fed will have to cut rates beginning early 2024, but this may not happen.

El-Erian, who said he could not predict where the crypto market is headed in terms of price performance, is however optimistic about crypto’s future in relation to the growing adoption by Wall Street giants. It is this perspective that could outline the potential impact to cryptocurrency prices.

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• Lightspark CEO says Bitcoin could help transform global payments.
• David Marcus explained his view today on CNBC’s “Squawk Box”.
• Bitcoin is currently down about 20% versus its year-to-date high.

David Marcus – the Chief Executive of Lightspark sees a big future for Bitcoin that’s down 20% versus its year-to-date high at writing.

Bitcoin could transform global payments

Marcus has a vision for the world’s largest cryptocurrency that goes well beyond its current stature as a store of value only.

On CNBC’s “Squawk Box”, he asserted that Bitcoin actually had the potential to play a significant role in making global payments as seamless as texting.

What we’re trying to do is turn Bitcoin into a real global payment network. We’re still in the fax era of global payments. That’s what we’re attempting to solve.

Marcus finds the existing fintech apps somewhat inadequate in facilitating cross-border payments. He has previously served as the president of PayPal Holdings Inc.

Bitcoin is not a currency for everyday use

Lightspark is committed to addressing the scalability issues surrounding Bitcoin and making Bitcoin transactions both faster and cheaper.

But the goal is not really to turn Bitcoin into a currency that can be used for everyday transactions, he added in his interview with CNBC today.

Bitcoin on top of Lightning is like a small data packet only for value. You can exchange at edges of network and send dollars to someone who’ll receive Yen or Euros.

Marcus admitted the need to work closely with the regulators to unlock the full potential of Bitcoin in revolutionising the global payment ecosystem.

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• Bernstein analyst says Grayscale ruling was a game changer.
• Gautam Chhugani expects Bitcoin to materially benefit from it.
• The world’s largest cryptocurrency is still lingering around $26,000.

The recent ruling in favour of Grayscale and against the Securities & Exchange Commission was a “game changer”, says Gautam Chhugani – a Bernstein analyst.

Chhugani expects Bitcoin to gain momentum

Last week, a U.S. Court said the regulator lacked adequate reasoning to block Grayscale from converting its bitcoin trust to an exchange-traded fund.

The verdict is a big step towards the first U.S. Bitcoin ETF and paves way for a significant institutions-driven rally in the world’s largest cryptocurrency, as per Chhugani.

Strong showing in courts improved ETF chances and the progressive institutional interest are positioning crypto for an unprecedented institution capital led cycle.

Earlier this year, Ripple secured a huge win in its long-running lawsuit against the Securities & Exchange Commission as well (find out more).

How soon could a Bitcoin ETF be approved?

Despite positive catalysts in recent months, Bitcoin is still lingering around the $26,000 level – well below its year-to-date high of over $31,000. Still, Bernstein’s Chhugani said in his research note today:

This is a cycle slower to take off, but is being laid on much strong fundamental grounds of regulatory clarity and more strategic long-term players entering the space.

He expects the first U.S. Bitcoin ETF to become a reality by March of 2024 at the very most. But the analyst does not expect that exchange-traded fund to be the end of it.

Chhugani is convinced that asset managers will push for a Spot Ethereum ETF afterwards and may even venture eventually into Solana and Polygon.

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