Custody and cyber/security breach
Bitcoin is held through custodians and private-key infrastructure that can be targeted by theft or failure.
- Scope
- Fund assets held in custody
- Materiality
- high
Franklin Templeton Digital Holdings Trust
Franklin Templeton Digital Holdings Trust is a Delaware statutory trust that operates a single exchange-traded fund, the Franklin Bitcoin ETF (ticker: EZBC). The trust is designed to give investors bitcoin price exposure through listed securities rather than direct ownership of bitcoin, with the fund holding bitcoin and using custodians and trading counterparties to support creation, redemption, and custody.
| % | |
|---|---|
| Exchange-traded bitcoin exposure | 100% The fund’s core offering is listed shares that seek to reflect the price of bitcoin, net of expenses. |
The trust’s investors are market participants who want bitcoin exposure in a brokerage account without directly buying,...
- Retail brokerage investorsprimary
Buy EZBC shares for bitcoin exposure without managing wallets or custody.
- Financial advisers and wealth platformsprimary
Use the ETF as a packaged bitcoin allocation inside managed portfolios.
- Institutional investorssecondary
Use listed shares for tactical or strategic bitcoin exposure with exchange liquidity.
- Authorized participants and market makerssecondary
Create, redeem, and trade shares to maintain ETF market functioning.
The trust is organized in Delaware and operates as a U.S.-listed product on Cboe BZX Exchange...
- •Formed as a Delaware statutory trust in the United States
- •Shares listed on Cboe BZX Exchange in the U.S.
- •Bitcoin custody and cash custody are handled by U.S.-linked service providers
- •Trading relies on approved connected venues and market makers
- •Exposure is global through bitcoin, but operations are U.S.-regulated
The trust’s strategy is to provide a convenient, cost-effective listed vehicle for bitcoin exposure while reducing the...
01
Maintain tight linkage to bitcoin priceshort-term
The fund’s value proposition depends on tracking bitcoin closely after expenses.
02
Preserve custody and trading integrityshort-term
Operational reliability is essential because the product depends on third-party custodians and venues.
03
Adapt to digital-asset regulationmedium-term
Regulatory changes could affect the fund’s ability to operate and the attractiveness of the shares.
The main risks come from bitcoin price volatility, regulatory uncertainty, and dependence on third-party custodians,...
Bitcoin price volatility
The fund is designed to reflect bitcoin performance, so asset price moves flow directly into NAV.
- Scope
- Fund NAV and share price
- Materiality
- high
Regulatory uncertainty for digital assets
New laws or enforcement actions could ban, restrict, or burden bitcoin-related activities.
- Scope
- Fund operations, liquidity, investor demand
- Materiality
- high
Connected trading venue disruption
The prime broker routes orders through third-party venues, so outages or insolvency can impair execution and recovery.
- Scope
- Trading, redemptions, liquidity
- Materiality
- high
Tax and licensing uncertainty
Unclear treatment as a money services business or money transmitter could create extra expenses and compliance obligations.
- Scope
- Sponsor and trust compliance costs
- Materiality
- medium
Fair value measurement of bitcoin
Directly affects NAV, earnings, and period-to-period comparability
Principal market determination
Can change reported valuation and NAV
Sponsor fee accrual
Reduces reported performance
Share creation and redemption accounting
Impacts assets under management and per-share metrics
: 28.4.2026