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Franklin Templeton aims to revolutionize how dividends are utilized. The asset management firm has filed an application with the SEC to launch two ETFs that automatically reinvest stock dividends into Bitcoin — not additional shares, but Bitcoin.
The two funds are named Franklin US Equity Bitcoin DRIP Index ETF and Franklin US Innovation Bitcoin DRIP Index ETF. The regulatory filing is complete, and a launch as early as September 1 is possible, according to the documents. The mechanism is simple to understand but quite novel in practice: the DRIP technique, typically used to repurchase shares with received dividends, is repurposed here to accumulate Bitcoin instead. Each fund starts with 95% in large-cap U.S. stocks and 5% in Bitcoin. The dividends generated by these stock portfolios are then invested in Bitcoin-related instruments — exchange-traded products, futures, options. The first ETF tracks the VettaFi US Large-Cap 500 Bitcoin DRIP index. The second targets so-called innovative companies.
Not a timid strategy.
Franklin Crypto, BENJI, Ondo: A Digital Asset Powerhouse
Franklin Templeton is not just filing for two ETFs. The company has been building something broader for several months. In May, it partnered with Payward — Kraken’s parent company — to tokenize traditional investment products. This move goes well beyond marketing: it means that traditional funds can circulate on blockchain rails.
There’s also BENJI. Franklin Templeton’s tokenized money fund has been integrated into MoonPay Trade’s infrastructure. Institutional users can now exchange stablecoins — USDC, USDT — for this tokenized fund via blockchain infrastructure. This is tangible, not just a concept.
Franklin has also struck a deal with Ondo Finance to offer tokenized versions of its existing ETFs, with transactions available 24/7 from crypto wallets. The idea is to capture investors outside the United States who want access to Franklin products without going through traditional channels.
To oversee all this, the company has created Franklin Crypto — a division dedicated to cryptocurrencies, born from the acquisition of 250 Digital, an entity spun off from CoinFund.
Franklin Templeton manages $1.5 trillion in assets. This is not a startup testing ideas.
Bitcoin Below $62,700, but Institutions Keep Pushing
Interesting timing. Bitcoin is hovering around $62,700 this Friday — down more than 50% from its peak in October 2025. The market is sluggish. Yet major financial houses continue to stack up products.
BlackRock has just launched the iShares Bitcoin Premium Income ETF. The logic here is different: the fund generates monthly income through the sale of covered call options on Bitcoin. The goal is to turn Bitcoin’s volatility into a regular income source for investors who dislike raw risk.
Two approaches, same direction. BlackRock wants to monetize volatility. Franklin Templeton wants to passively accumulate Bitcoin via dividends. Both target traditional investors who likely do not want to buy Bitcoin directly on an exchange.
Things are changing fast.
The SEC released general standards for crypto-linked funds at the end of 2025. Since then, Bitwise estimates that more than 100 crypto ETFs could be launched in 2026. We might just be at the beginning of this wave.
Franklin Templeton’s two DRIP ETFs fit into this dynamic — but with a mechanism not really seen before. Reinvesting dividends in Bitcoin rather than stocks is a bet that institutional investors want crypto exposure without having to make active choices. Accumulation happens automatically, as dividends are paid.
It is still unclear whether the SEC will approve the two funds within the expected timeframe. The September 1 date remains conditional on regulatory approval. Franklin Templeton has not publicly disclosed details of the approval timeline.
What is certain: with $1.5 trillion under management and a dedicated crypto division, Franklin Templeton is no longer in exploration mode. The 5% Bitcoin allocation at the launch of the two ETFs may seem modest — but multiplied by the dividend flows of a large-cap U.S. stock portfolio, accumulation can become significant over the long term.
Hub: Bitcoin: Price, News, and Analysis
Frequently Asked Questions
What are the two ETFs filed by Franklin Templeton with the SEC?
Franklin Templeton has filed for the Franklin US Equity Bitcoin DRIP Index ETF and the Franklin US Innovation Bitcoin DRIP Index ETF, two funds that reinvest stock dividends into Bitcoin with an initial allocation of 5% in Bitcoin.
What is the DRIP technique used by these ETFs?
The DRIP technique normally reinvests dividends into additional shares. In these funds, it is used to buy Bitcoin-related instruments — exchange-traded products, futures, or options — instead.
Does Franklin Templeton have other initiatives in digital assets?
Yes: partnership with Payward (Kraken) to tokenize traditional products, integration of the BENJI fund into MoonPay Trade, agreement with Ondo Finance for tokenized ETFs, and creation of Franklin Crypto through the acquisition of 250 Digital from CoinFund.
