Renowned asset manager Franklin Templeton, with a staggering $1.5 trillion in assets under management, unveiled an audacious plan on Tuesday. The firm aims to throw an ETF (exchange-traded fund) exclusively dedicated to XRP, the fourth-largest cryptocurrency in terms of market capitalization, as revealed in a recent S-1 filing with the US Securities and Exchange Commission (SEC).
At the time of publication, the price of XRP was quoted at US$2.32, up 2.4% in the last 24 hours.
According to the document, the Franklin XRP ETF’s main purpose is to mirror the price performance of XRP. The shares of the proposed fund will be listed and traded on the renowned Cboe BZX Exchange. The intention is clear: “The Shares are intended to provide a convenient means of making an investment similar to an investment in XRP with respect to acquiring, holding, and trading XRP directly on a peer-to-peer or other basis or through a digital asset platform.”
The fund’s design emphasizes the passive nature of the investment, ruling out any use of leverage or derivative products. “The Sponsor does not sell XRP at times when its price is high or acquire XRP at low prices in the expectation of future price increases. The Fund will not use leverage, derivatives or similar instruments or transactions in seeking to achieve its investment objective.”
A key player in this operation will be New York-based Coinbase Custody Trust Company. The company is responsible for cold storage of cryptocurrencies and will act as custodian of the fund’s XRP assets.