Franklin Templeton proposes Bitcoin DRIP ETFs

Franklin Templeton has filed with the SEC to launch two new exchange-traded funds on the Nasdaq that utilize a Dividend Reinvestment Plan (DRIP) to acquire Bitcoin. The proposed funds are the Franklin US Equity Bitcoin DRIP Index ETF (FBEQ) and the Franklin US Innovation Bitcoin DRIP Index ETF (FIBT).

At launch, both funds are expected to consist of 95% equities and 5% Bitcoin. Instead of using dividends to purchase more shares of the underlying stocks, the funds will direct all dividend cash toward accumulating Bitcoin through Bitcoin ETPs, futures, or options. This strategy allows the Bitcoin allocation to grow over time based on the available dividend income and market timing.

The FBEQ fund aims to replicate an index of the 500 largest U.S. companies, similar to the S&P 500, with an annual management fee of 0.09%. The FIBT fund targets the 100 largest technology companies on the Nasdaq, similar to the Nasdaq 100, with a management fee of 0.19%.