Franklin Templeton's XRPZ now holds over 118 million XRP with the lowest fee in the market at 0.19%. How fee wars and institutional access are reshaping XRP adoption.

Franklin Templeton Holds 118M XRP in New ETF at 0.19% Fees

Franklin Templeton filed its first quarterly report with the SEC, and the numbers confirm what was already visible on-chain: the firm is holding serious size. As of December 31, 2025, the Franklin XRP ETF held 118,387,154 XRP tokens with a fair value of approximately $216.37 million. More recent data from the firm's website shows total net assets have grown to $243.6 million as of mid-February 2026.

That puts Franklin's XRPZ in third place among the seven spot XRP ETFs currently trading in the US. Canary Capital's XRPC leads with roughly $376 million in AUM, followed by Bitwise's XRP at around $300 million. Combined, the entire XRP ETF market now holds over $1 billion in assets and has locked approximately 793 million XRP tokens.

What's interesting isn't just the absolute size of Franklin's position. It's the strategy behind how they're competing for it.

Franklin launched XRPZ on November 24, 2025, with an expense ratio of 0.19%. That's the lowest fee structure in the entire XRP ETF category. Bitwise charges 0.34%. Grayscale charges 0.35%, though they're temporarily waiving fees until February 2026. Once that waiver expires, Franklin's fee advantage becomes structural.

The difference might seem small on paper, but it compounds over time. If you invest $50,000 and assume an 8% annual return over 20 years, the gap between a 0.19% fee and a 0.34% fee results in over $26,000 in savings. That's not rounding error. That's real capital that stays in the investor's account rather than going to the fund manager.

Franklin can afford to price this aggressively because of scale. The firm manages over $1.5 trillion in assets globally. They've been in the asset management business since 1947, nearly 80 years. That kind of institutional infrastructure allows them to operate at margins that would be unprofitable for smaller issuers.

But there's another advantage Franklin brings that has nothing to do with fees. Many institutional investors operate under strict approved manager lists. These are internal compliance frameworks that limit which asset managers a pension fund, endowment, or insurance company can use. Franklin is on virtually every one of those lists. Bitwise and Canary Capital, despite being excellent operators, are not.

That means XRPZ may be the only XRP ETF certain institutions can access, regardless of whether they prefer another fund's features or liquidity profile. Access is half the battle when it comes to institutional capital flows.

Since launching, XRPZ has seen steady inflows. The XRP ETF category as a whole has gone 43 consecutive days without a single net outflow day across all funds. That's unusual. Most new ETF categories experience some redemption activity as early investors take profits or rebalance. XRP ETFs haven't seen that yet.

Part of the demand is structural. For years, institutional investors who wanted XRP exposure had to either hold the token directly — which introduces custody risk, operational complexity, and tax reporting headaches — or avoid the asset entirely. ETFs solve that problem. They offer regulated exposure through a familiar wrapper that fits inside existing brokerage accounts, IRAs, and 401(k) plans.

The timing also matters. XRP's legal status became clearer after years of uncertainty with the SEC. That regulatory clarity opened the door for ETF issuers to launch products without the same legal risk that existed previously. Combine that with a general appetite for altcoin exposure during a period when Bitcoin and Ethereum ETFs were already established, and you get the conditions for rapid adoption.

Performance has been rough, though. XRP's price fell 57% from $2.577 in November 2025 to as low as $1.11 in February 2026. As of mid-February, it trades around $1.48. That decline has pulled down the net asset value (NAV) of all XRP ETFs, including Franklin's. XRPZ's NAV dropped to $16.08, with year-to-date returns at -18.54% and since-inception returns at -23.20%.

That's not unusual for a new crypto ETF launching during a market correction. But it does raise the question of whether inflows will continue if price remains under pressure. Historically, ETF flows tend to follow momentum. When an asset is rising, inflows accelerate. When it's falling, they slow or reverse.

So far, XRP ETFs haven't seen that reversal. Flows have remained positive even as price declined. That suggests the demand is less about momentum trading and more about long-term positioning. Institutions aren't necessarily buying because they think XRP will rally next week. They're buying because they want exposure as part of a broader digital asset allocation, and the ETF structure is the only way they're allowed to get it.

Franklin's holdings also reflect the broader trend of supply being locked inside structured products. Between ETFs, DeFi protocols, corporate treasuries, and exchange reserves, a growing percentage of XRP's circulating supply is being removed from active trading. That doesn't guarantee price appreciation, but it does change the supply-demand dynamics. Fewer tokens available on exchanges means thinner order books, which can lead to sharper price moves when demand does appear.

The question moving forward is whether Franklin's fee advantage and institutional access translate into sustained inflows. If the firm can continue pulling capital from competitors through lower fees, they could eventually overtake Canary and Bitwise for the largest AUM in the category. If institutional allocators start entering the space in larger size — pension funds, insurers, sovereign wealth — Franklin's position on approved manager lists becomes even more valuable.

But none of that matters if the underlying asset doesn't perform. Franklin's XRPZ is a wrapper, not a catalyst. It provides access, not upside. Whether XRP rallies from here depends on factors outside Franklin's control: adoption of the XRP Ledger for payments, growth of Ripple's RLUSD stablecoin, liquidity conditions in global markets, and whether institutional demand for altcoin exposure continues.

What's clear is that Franklin has positioned itself as the low-cost, institutional-grade option in a category that's still defining itself. The fund holds over 118 million tokens, charges the lowest fee in the market, and has the infrastructure to handle large-scale capital flows. Whether that's enough to dominate the category will depend on how the next few quarters play out.