Franklin Bitcoin ETF

What they do

The Trust is a Delaware statutory trust offering one series, the Franklin Bitcoin ETF, which seeks to reflect the performance of the price of bitcoin before expenses. The Fund issues and redeems Shares only in Creation Units of 50,000 Shares to Authorized Participants, in exchange for cash. The Fund holds bitcoin with Coinbase Custody as custodian and uses Coinbase Inc. as prime broker; The Bank of New York Mellon serves as administrator, transfer agent, and cash custodian. The Sponsor, Franklin Holdings, LLC, does not actively manage the bitcoin holdings, and the Fund does not use leverage or derivatives.

Revenue drivers

• Sponsor's fee — The Fund's only ordinary recurring expense is the Sponsor's fee, which is accrued and paid in bitcoin. This fee compensates the Sponsor for assuming the Fund's ordinary fees and expenses, including those of the Administrator, Custodian, and Marketing Agent.
• Creation Unit issuance — The Fund continuously issues Shares in blocks of 50,000 (Creation Units) to Authorized Participants in exchange for cash, generating net asset inflows that increase the bitcoin held by the Fund.
• Bitcoin price appreciation — The value of the Fund's assets, and thus its income statement, is driven by changes in the market price of bitcoin. Net income or loss reflects gains or losses on the bitcoin held, as seen in the reported figures.
• Redemption activity — Authorized Participants may redeem Creation Units for cash, which reduces the bitcoin held and can affect the Fund's size and expense ratio, though the Fund earns no direct revenue from redemptions.

Recent performance

For fiscal year 2026, the Trust reported a net loss of $118.5 million, compared with net income of $109.2 million in 2025. Operating cash flow was negative $137.0 million in 2026, down from positive $40.2 million in 2025. As of March 31, 2026, total assets were $429.4 million, total liabilities were $69,685, and shareholder equity was $377.4 million. The Trust reported zero cash and equivalents, with its assets held in bitcoin.

Strategy

The Trust is a passive investment vehicle, with no active management of bitcoin holdings; the Sponsor does not buy or sell bitcoin based on price expectations. The Fund's stated strategy is to provide a cost-effective, convenient way to gain bitcoin exposure through a regulated exchange-traded product. During the period covered by the latest filings, Creation Units were issued and redeemed in cash, though the Fund retains the ability to conduct in-kind transactions. The Sponsor has agreed to assume the Fund's ordinary expenses except the Sponsor's fee, which is designed to keep the expense structure simple.

Risks

• Bitcoin price volatility — The value of the Shares is directly tied to the price of bitcoin, which has been highly volatile and could decline to zero or near-zero, causing a total loss of investment.
• Key custody risk — Bitcoin private keys could be lost, stolen, or compromised, potentially leading to a permanent loss of the Fund's assets, as digital assets are bearer instruments with no recourse.
• Regulatory and operational risk — The Trust is not registered under the Investment Company Act and is not a commodity pool, so it is subject to less regulatory oversight, and the process for creation/redemption may be disrupted.
• Fork and governance risk — Temporary or permanent forks in the Bitcoin blockchain, or changes in governance that lack user/miner support, could adversely affect the value of the Shares.

Outlook

Management does not provide explicit financial guidance, but the Trust's performance will depend on bitcoin price movements and the continued functioning of the creation/redemption mechanism. The Sponsor expects the Fund's only recurring expense to be the Sponsor's fee, which is intended to keep total expenses predictable. There is no stated intention to change the passive investment strategy or to introduce additional series.