Franklin Templeton has introduced two new exchange-traded funds (ETFs) on Nasdaq that integrate traditional U.S. equity dividends with exposure to bitcoin. The Franklin U.S. Equity Bitcoin DRIP Index ETF (FBEQ) and the Franklin U.S. Innovation Bitcoin DRIP Index ETF (FIBT) have completed all regulatory requirements and are now available for institutional and retail investors.
ETF structure blends dividends and bitcoin
FBEQ tracks the VettaFi U.S. Large-Cap 500 Bitcoin DRIP Index, which consists of the 500 largest U.S. companies by market capitalization. The index is weighted by float-adjusted market cap, with a concentration in the information technology sector. As of September 30, it included 499 stocks ranging from $10.2 billion to $5.5 trillion in market value.
At the fund’s launch, the portfolio allocates 95% to equities and 5% to bitcoin. Rather than reinvesting dividend payouts in the original equities, this structure automatically channels each dividend directly into bitcoin at the market open on the day after the ex-date. This process continually grows the fund’s bitcoin exposure with every dividend payment.
Traditionally, dividend reinvestment plans (DRIPs) use cash distributions to buy additional shares of the dividend-issuing stock. However, Franklin Templeton’s new ETFs use those dividends to systematically purchase bitcoin, providing regular BTC accumulation without requiring investors to establish exchange accounts or manage cryptocurrency custody.
To maintain a balanced risk profile, the fund places strict controls on its bitcoin allocation. During quarterly rebalancing, any allocation above 5% is reduced to 4.5%. If bitcoin exposure exceeds 20% at any point between scheduled rebalances, the allocation is swiftly trimmed back to 4.5% within two business days, and proceeds are reinvested in equities.
How the funds manage bitcoin exposure
The ETFs do not directly hold bitcoin on-chain. Instead, they gain exposure through various exchange-traded products, including Franklin Templeton’s own spot bitcoin fund, as well as bitcoin futures, options, and depositary receipts—certain exposures may be managed via a Cayman Islands subsidiary.
FBEQ features an expense ratio of 0.09% and does not apply any 12b-1 distribution fees. The fund is managed by Franklin Advisory Services, with Franklin Templeton Institutional acting as sub-advisor.
For investors following dividend-linked bitcoin strategies, tools that offer real-time portfolio monitoring and dividend tracking may be particularly valuable. CryptoAppsy’s customizable interface allows users to monitor their ETF performance, receive timely price alerts on bitcoin allocation changes, and stay updated with live crypto news—all without needing to manage multiple apps or data sources.
Industry perspective on bitcoin’s integration
Dina Ting, Senior Vice President and Head of Index Investments at Franklin Templeton, stated that bitcoin now benefits from robust market infrastructure, expanded adoption, and a stronger understanding of its role in investor portfolios. She emphasized that a systematic approach to bitcoin allocation could support the next phase of integration among traditional assets.
Jeff Masom, Head of U.S. Distribution and Global Wealth Management Private Markets, described the ETFs as innovative vehicles that combine U.S. equities and bitcoin through advanced index methodologies.
“Bitcoin has matured as an investable asset, supported by deeper market infrastructure, broader adoption and a growing understanding of the role it can play in portfolios,” remarked Dina Ting, highlighting the rationale behind Franklin Templeton’s approach.
