The launch of the Franklin Ethereum ETF (EZET) marks a pivotal development in the mainstream integration of digital assets into traditional investment portfolios. Franklin Templeton, a globally recognized investment management firm, has officially entered the spot ether (ETH) exchange-traded fund (ETF) market with its new offering listed on the Cboe BZX Exchange under the ticker symbol EZET. This move follows the successful debut of its spot bitcoin ETF earlier in 2024 and underscores the firm’s growing commitment to digital asset innovation.
A Strategic Expansion in Digital Asset Offerings
Franklin Templeton’s introduction of EZET reflects its strategic expansion within the digital assets and ETF ecosystems. The fund is designed to track the performance of ether’s price—less operational expenses—providing U.S. investors with regulated, transparent exposure to Ethereum through a familiar brokerage account structure.
Priced at an expense ratio of just 0.19%, or 19 basis points, the Franklin Ethereum ETF comes with a compelling fee waiver: Franklin Templeton has committed to fully waive management fees until January 31, 2025, for the first $10 billion in assets under management. This incentive positions EZET as one of the most competitively priced ETH ETFs available.
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Seamless Integration into Traditional Finance
Patrick O’Connor, Head of Global ETFs at Franklin Templeton, emphasized the importance of accessibility and integration:
“After the success of our spot bitcoin ETF (EZBC) launch in January, we are proud to add EZET to our growing lineup of digital asset ETFs. With EZET, we are thrilled to offer our clients additional access to the digital asset ecosystem within a regulated fund structure that integrates seamlessly into traditional portfolios.”
This sentiment highlights a broader trend—institutional adoption of blockchain-based assets—and signals growing confidence in Ethereum’s role beyond speculation, positioning it as a foundational component of next-generation financial infrastructure.
Deep Roots in Blockchain Innovation
Franklin Templeton’s involvement in digital assets dates back to 2018, well before the current wave of ETF approvals. Since then, the firm has been actively building blockchain-based technology solutions, operating node validators, and developing investment strategies grounded in deep research.
Roger Bayston, Head of Digital Assets at Franklin Templeton, shared insights into the firm’s long-term vision:
“We have been active participants and builders in the digital asset ecosystem since 2018 and have seen the transformative power of blockchain technology firsthand. Ethereum has been at the forefront of Web3 innovation with things like smart contracts and the Ethereum Virtual Machine—and we're excited to bring that technology revolution to our clients.”
This hands-on experience gives Franklin Templeton a distinct edge in understanding both the technical and economic dynamics of ether, smart contracts, and decentralized applications (dApps).
Core Features of the Franklin Ethereum ETF
- Spot Exposure: The fund holds actual ether, not futures or derivatives.
- Regulated Structure: Offers SEC-compliant access to ETH for retail and institutional investors.
- Passive Management: Tracks ether’s price directly without active trading or hedging.
- No Staking Rewards: The fund does not stake ETH, meaning shareholders won’t earn staking yields.
- Transparent Pricing: Daily net asset value (NAV) calculated using a trusted pricing index.
While the lack of staking may be seen as a limitation by yield-seeking investors, it aligns with regulatory clarity and operational simplicity—key considerations for broad market adoption.
Addressing Risks and Investor Concerns
As with any investment in digital assets, EZET comes with inherent risks that potential investors should understand:
- Market Volatility: Ether prices have historically been volatile. Rapid price swings can significantly impact the value of shares.
- Regulatory Uncertainty: The U.S. digital asset regulatory landscape remains fluid. Future legislation could affect ETH’s legality, usage, or market structure.
- Security Risks: Although custodial protections are in place, cyber threats to digital wallets and custodians remain a concern.
- Fork Risk: In the event of a blockchain fork, the fund may not capture new assets distributed via airdrops.
- Expense Drift: Over time, ether reserves will decrease due to sales covering management fees, potentially diluting share value if ETH prices stagnate.
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Part of a Broader ETF Ecosystem
Franklin Templeton’s U.S. ETF platform, established in 2016, offers active, smart beta, and passive strategies across diverse asset classes. With over 100 ETFs globally and more than $20 billion in ETF assets under management as of June 30, 2024, the firm brings substantial scale and expertise to this new venture.
The Franklin Ethereum ETF builds on this foundation, extending the reach of traditional investors into the world of decentralized finance (DeFi) and Web3 technologies.
Frequently Asked Questions (FAQ)
What is the Franklin Ethereum ETF (EZET)?
EZET is a spot ether ETF that provides investors with direct exposure to ether’s price performance through a regulated exchange-traded product structure.
How does EZET differ from other crypto ETFs?
Unlike futures-based crypto ETFs, EZET holds actual ether. It also benefits from Franklin Templeton’s institutional-grade custody, transparency, and fee waiver for early investors.
Is EZET actively managed?
No. EZET is a passively managed fund that seeks to track ether’s price without engaging in active trading or hedging strategies.
Does EZET offer staking rewards?
No. The fund does not stake ether and therefore does not generate staking income for shareholders.
Where can I buy shares of EZET?
Shares are available through brokerage accounts that support trading on the Cboe BZX Exchange.
What are the main risks of investing in EZET?
Key risks include ether price volatility, regulatory changes, cybersecurity threats, and structural limitations such as no staking or hedging.
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A Milestone for Institutional Crypto Adoption
With over $1.6 trillion in total assets under management and more than 75 years of investment experience, Franklin Templeton’s entry into the ETH ETF space sends a strong signal: digital assets are no longer niche—they are becoming core components of modern portfolios.
By combining deep technical expertise with rigorous compliance standards, Franklin Templeton is helping bridge the gap between traditional finance and decentralized innovation. As Ethereum continues to evolve as a platform for smart contracts, DeFi, NFTs, and enterprise solutions, products like EZET make it easier than ever for mainstream investors to participate—responsibly and transparently.
Keywords: Franklin Ethereum ETF, EZET, spot ether ETF, digital assets, ETF, ether, Ethereum, Web3