Franklin Templeton Wants Your Stock Dividends to Buy the Dip, Literally 📈→₿

Franklin Templeton filed with the Securities and Exchange Commission on Thursday to launch two exchange-traded funds that systematically channel stock dividends into Bitcoin ($BTC). The Franklin U.S. Equity Bitcoin DRIP Index ETF and the Franklin U.S. Innovation Bitcoin DRIP Index ETF each hold a basket of U.S. equities — a VettaFi U.S. large-cap 500 index in one case and a VettaFi U.S. innovation 100 index in the other — and route the dividends those companies pay into Bitcoin rather than back into the underlying shares. The "DRIP" in each name references traditional dividend reinvestment plans, repurposed to accumulate $BTC.

According to the filing, each underlying index begins with a 5% Bitcoin weighting and 95% equities, with $BTC exposure capped at 20% and trimmed back at quarterly rebalances. The funds would obtain their crypto exposure through exchange-traded products, including Bitcoin ETPs sponsored by Franklin Templeton affiliates, along with options and futures, and in some cases through a wholly-owned subsidiary in the Cayman Islands. VettaFi maintains the indices. The registration statement is preliminary, lists no fees, and under the rule Franklin used could take effect roughly 75 days after filing, placing a potential launch in early September.

The proposals arrive amid a surge of crypto ETF filings. After the SEC published generic listing standards for crypto-linked funds in late 2025, issuers moved quickly to bring product to market. Bitwise has projected more than 100 such ETFs could launch in 2026, and Bloomberg Intelligence's James Seyffart counted well over 100 filings in the pipeline at the end of last year, with issuers "throwing A LOT of product at the wall." Much of that activity has moved beyond plain spot exposure, where BlackRock's iShares Bitcoin Trust leads with tens of billions in assets, toward funds that compete on structure and yield. Issuers have rolled out covered-call income products such as BlackRock's newly launched iShares Bitcoin Premium Income ETF, with Franklin's dividend-into-Bitcoin design the latest variation on that theme.

The filings extend an aggressive push into digital assets for Franklin Templeton. The firm already runs its own spot Bitcoin ETF, announced Wednesday the formation of a Franklin Crypto unit following its acquisition of 250 Digital — a crypto investment firm and spinoff from CoinFund — and struck a tokenization partnership with Kraken parent Payward. The 250 Digital acquisition, expected to close in the second quarter, brings that team's crypto strategies into Franklin, with the asset manager investing in those strategies as part of the deal. "Crypto's institutional moment has arrived, and Franklin Crypto will help our global clients navigate this complex," the firm said. The Franklin Crypto unit will operate alongside the asset manager's existing BENJI tokenized money-market product and other digital-asset offerings.