As of September 30, 2024, Franklin Templeton Digital Holdings Trust reported significant growth in its investment portfolio, primarily driven by its holdings in bitcoin. The trust's investment in bitcoin at fair value reached $452.4 million, a substantial increase from $341.9 million as of March 31, 2024. This growth reflects an increase in the number of bitcoins held, from 4,842.9986 BTC to 7,103.8488 BTC during the same period.
The trust's total assets also rose to $452.4 million, up from $341.9 million, while net assets increased to $452.3 million from $341.9 million. However, the net asset value (NAV) per share decreased from $40.95 to $36.92, attributed to fluctuations in bitcoin prices, which fell from $70,596.99 to $63,677.63 over the six-month period.
In terms of operations, the trust experienced a net decrease in net assets resulting from operations of $(33.6 million) for the six months ended September 30, 2024, compared to a net increase of $2.7 million for the three months ended September 30, 2024. The net change in unrealized appreciation on bitcoin investments was $(32.3 million) for the six-month period, contrasting with a positive change of $4.1 million for the three-month period.
The trust issued a total of 5,850,000 shares during the six months, raising $209.7 million, while redeeming 1,950,000 shares. The total number of shares outstanding increased from 8,350,000 to 12,250,000. The trust's cash flow from operating activities was negative at $(144.0 million), but financing activities provided a corresponding $144.0 million.
The Franklin Bitcoin ETF, which commenced operations on January 11, 2024, is designed to reflect the performance of bitcoin prices before expenses. The fund's shares are traded on the Cboe BZX Exchange under the ticker symbol "EZBC." The trust has adopted the Accounting Standards Update (ASU) 2023-08, which mandates fair value measurement for crypto assets, with no material impact on its financial statements.
Overall, the trust's performance is closely tied to bitcoin price movements, which are tracked using the CME CF Bitcoin Reference Rate. The trust and the fund do not have any off-balance sheet arrangements and are not subject to any material legal proceedings as of November 12, 2024.
About Franklin Templeton Digital Holdings Trust
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