Traditional asset manager Franklin Templeton is pushing deeper into crypto innovation. According to a report by The Block on June 19, 2026, the firm formally submitted registration documents to the U.S. SEC for two novel ETFs. Their standout feature: a DRIP (Dividend Reinvestment Plan) mechanism that automatically converts cash dividends from constituent stocks into Bitcoin, rather than reinvesting in the same equities.
How the Two DRIP ETFs Work
The filings name the funds “Franklin US Equity Bitcoin DRIP Index ETF” and “Franklin US Innovation Bitcoin DRIP Index ETF.” Unlike conventional DRIP plans that use dividends to buy more of the same stock, these ETFs systematically convert dividends into Bitcoin. Investors thus retain their equity exposure while passively accumulating Bitcoin — no manual rebalancing required.
The initial allocation targets 95% U.S. equities plus 5% Bitcoin. One fund tracks roughly 498 large-cap stocks with market caps between $7.5 billion and $4.9 trillion; the other focuses on innovation and growth companies. To manage volatility, a quarterly rebalancing mechanism is built in: if Bitcoin’s allocation exceeds 5% due to price appreciation, the system trims it back to 4.5%. In extreme conditions, Bitcoin exposure is capped at 20%. The funds will gain Bitcoin exposure through spot ETFs, futures, options, and possibly Franklin’s own products. If approved, the earliest launch date is September 1, 2026.
Franklin’s Broader Crypto Push
This isn’t Franklin’s first crypto move. Its existing spot Bitcoin ETF (ticker: EZBC) holds about $358.9 million in assets under management, with net inflows of $329.6 million. In May of this year, the firm partnered with Kraken’s parent, Payward, to explore tokenization of traditional investment products. Earlier this month, it integrated the BENJI tokenized money market fund into the MoonPay Trade platform, streamlining settlement efficiency between stablecoins and tokenized funds for institutional users.
With these DRIP ETFs, Franklin is bridging traditional finance and digital assets through a structure that’s both concrete and tradeable.