Franklin Templeton’s digital assets division recently released a note to its investors, providing an overview of Bitcoin-based nonfungible tokens (NFTs). The division, known as Franklin Templeton Digital Assets, acknowledged the significant role played by the Bitcoin Ordinals protocol in driving innovation within the Bitcoin sphere.
Over the past year, the asset manager noted a surge in activity on Bitcoin, largely attributed to the Ordinals protocol. Additionally, Franklin Templeton highlighted the emergence of new fungible token standards such as BRC-20 and Runes, as well as Bitcoin-based layer-2 networks and DeFi primitives, all contributing to the progress of Bitcoin innovation.
The asset manager also observed a rapid acceleration in activities within the Bitcoin NFT sector. Franklin Templeton emphasized the growing dominance of Bitcoin within the broader NFT ecosystem, pointing out that several Bitcoin Ordinals collections have started to dominate the NFT space in terms of trading volume and market capitalization. Notable collections mentioned include NodeMonkes, Runestone, Bitcoin Puppets, Ordinal Maxi Biz, and Bitmap.
While expressing optimism about Ordinals, Franklin Templeton cautioned investors that these assets may experience depreciation and lack bank guarantees. The company also clarified that Ordinals assets are not insured by the Federal Deposit Insurance Corporation. Furthermore, the asset manager reiterated to its investors that all investments carry risks, including capital loss. Franklin Templeton emphasized the risks associated with digital assets due to their “immature” and rapidly evolving technology, as well as their vulnerabilities.
In previous investor notes, Franklin Templeton has introduced its clients to various niches within the crypto space. In March, the company published a note on memecoins, recognizing their potential for quick profits but also highlighting their lack of inherent value. The asset manager has also been active in the ETF market, launching a spot Bitcoin ETF earlier this year and submitting an S-1 filing for a spot Ether ETF.
In conclusion, Franklin Templeton Digital Assets is keeping its investors informed about the latest developments in the crypto space, including Bitcoin NFTs, while cautioning about the risks associated with these assets.