Franklin Crypto Trust

Previous wording

This quarterly report on Form 10-Q, including this “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and such forward-looking statements involve risks and uncertainties. All statements (other than statements of historical fact) included in this Form 10-Q that address activities, events or developments that may occur in the future, the Trust’s and the Fund’s operations, the Sponsor’s plans and references to the Trust’s and the Fund’s future success and other similar matters are forward-looking statements. Words such as “could,” “would,” “may,” “expect,” “intend,” “estimate,” “predict,” and variations on such words or negatives thereof, and similar expressions that reflect our current views with respect to future events and Fund performance, are intended to identify such forward-looking statements. These forward-looking statements are only predictions, subject to risks and uncertainties that are difficult to predict and many of which are outside of our control, and actual results could differ materially from those discussed. Forward-looking statements involve risks and uncertainties that could cause actual results or outcomes to differ materially from those expressed therein. We express our estimates, expectations, beliefs, and projections in good faith and believe them to have a reasonable basis. However, we make no assurances that management’s estimates, expectations, beliefs, or projections will be achieved or accomplished. These forward-looking statements are based on assumptions about many important factors that could cause actual results to differ materially from those in the forward-looking statements. We do not intend to update any forward-looking statements even if new information becomes available or other events occur in the future, except as required by the federal securities laws.

Current wording

This information should be read in conjunction with the financial statements and notes included in Item 1 of Part I of this Form 10-Q. This Form 10-Q contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and such forward-looking statements involve risks and uncertainties. All statements (other than statements of historical fact) included in this Form 10-Q that address activities, events or developments that may occur in the future, the Trust’s and the Fund’s operations, the Sponsor’s plans and references to the Trust’s and the Fund’s future success and other similar matters are forward-looking statements. Words such as “could,” “would,” “may,” “expect,” “intend,” “estimate,” “predict,” and variations on such words or negatives thereof, and similar expressions that reflect our current views with respect to future events and Fund performance, are intended to identify such forward-looking statements. These forward-looking statements are only predictions, subject to risks and uncertainties that are difficult to predict and many of which are outside of our control, and actual results could differ materially from those discussed. Forward-looking statements involve risks and uncertainties that could cause actual results or outcomes to differ materially from those expressed therein. We express our estimates, expectations, beliefs, and projections in good faith and believe them to have a reasonable basis. However, we make no assurances that management’s estimates, expectations, beliefs, or projections will be achieved or accomplished. These forward-looking statements are based on assumptions about many important factors that could cause actual results to differ materially from those in the forward-looking statements. We do not intend to update any forward-looking statements even if new information becomes available or other events occur in the future, except as required by the federal securities laws.

Previous wording

At March 31, 2026, the Digital Asset Custodian held the following Digital Assets on behalf of the Fund: 116.5159 bitcoin, with a market value of $7,938,186 (cost:$10,665,650), 623.6507 either, with a market value of $1,310,814 (cost: $1,798,262), 447,679.1676 XRP, with a market value of $603,024 (cost: $830,704), 4,037.3152 solana, with a market value of $336,591 (cost: $460,512), 1,013,880.3488 dogecoin, with a market value of $93,683 (cost: $126,824), 278,351.5809 cardano, with a market value of $68,306 (cost: $100,813), and 186,942.1635 stellar lumens, with a market value of $31,707 (cost: $40,002).

Current wording

At June 30, 2026, the Digital Asset Custodian held the following Digital Assets on behalf of the Fund: 155.4365 bitcoin, with a market value of $9,186,529 (cost:$13,071,883), 806.8154 ether, with a market value of $1,285,265 (cost: $2,077,864), 609,842.6656 XRP, with a market value of $639,908 (cost: $1,016,897), 5,398.9017 solana, with a market value of $406,915 (cost: $549,508), 1,502,862.6388 dogecoin, with a market value of $108,567 (cost: $170,059), 374,121.9642 cardano, with a market value of $55,818 (cost: $116,977), and 257,543.7911 stellar lumens, with a market value of $52,473 (cost: $54,156).

Previous wording

For the three months ended March 31, 2026, 150,000 Shares were issued in exchange for 29.0998 bitcoin, 158.0716 ether, 110,048.3021 XRP, 897.8243 solana, 249,648.4158 dogecoin, 71,022.6766 cardano, 1,077.2271 LINK, and 48,196.8658 XLM. No Shares were redeemed during the period. The Fund’s NAV per Share began the period at $22.70 and ended the period at $17.30 which represents a 23.79% decrease. During the same period the Fund accrued the Sponsor's Fee of $4,548. During the same period the Fund's Underlying Index fell from 11,716.12 to 8,574.16, a decline of 26.82%.

Current wording

For the three months ended June 30, 2026, 200,000 Shares were issued in exchange for 38.8575 bitcoin, 201.6955 ether, 152,454.4000 XRP, 1,349.6700 solana, 375,700.1900 dogecoin, 93,525.6000 cardano, and 64,383.3000 XLM. No Shares were redeemed during the period. The Fund’s NAV per Share began the period at $17.30 and ended the period at $14.67 which represents a 15.20% decrease. During the same period the Fund accrued the Sponsor's Fee of $5,401. During the same period the Fund's Underlying Index fell from 8,574.16 to 7,235.39, a decline of 15.61%. The variance between the Fund's return and the Underlying Index return is primarily due to differences in pricing sources. The Underlying Index is based on CF Reference Rates, while the Fund's reported performance is based on NAV calculated using Principal Market NAV for financial reporting purposes. Accordingly, the returns may not be directly comparable.

Previous wording

Net realized loss and change in unrealized depreciation on investments in Digital Assets for the period ended March 31, 2026, was approximately $2,459,675 which includes a net realized loss from Digital Assets sold to pay expenses and for rebalancing of $23,634 and a net change in unrealized depreciation on investments in Digital Assets of approximately $2,436,041. Net assets increased by approximately $165,257, from approximately $10,215,391 at December 31, 2025 to approximately $10,380,648 at March 31, 2026, primarily due to net capital share transactions of approximately $2,629,480, partially offset by a decrease in net assets resulting from operations of approximately $2,464,223.

Current wording

Net realized loss and change in unrealized depreciation on investments in Digital Assets for the period ended June 30, 2026, was approximately $1,698,861 which includes a net realized loss from Digital Assets sold to pay expenses and for rebalancing of $17,448 and a net change in unrealized depreciation on investments in Digital Assets of approximately $1,681,413. Net assets increased by approximately $1,353,044, from approximately $10,380,648 at March 31, 2026 to approximately $11,733,692 at June 30, 2026, primarily due to net capital share transactions of approximately $3,057,306, partially offset by a decrease in net assets resulting from operationsdue to Digital Asset price depreciationof approximately $1,704,262.

Previous wording

For the period February 20, 2025 (Date of commencement of operations) to March 31, 2025, 50,000 Shares were issued in exchange for 10.9374 bitcoin and 66.8158 ether. No Shares were redeemed during the period. The Fund's NAV per Share began the period at $25.13 and ended the period at $20.61. The 17.99% decrease in the Fund's NAV per Share from $25.13 per Share, as of February 20, 2025 (Date of commencement of operations) to $20.61 at March 31, 2025 is directly related to the 15.55% decrease in the price of bitcoin and 33.33% decrease in the price of ether over the same period.

Current wording

For the period from February 20, 2025 (Date of commencement of operations) to June 30, 2025, 50,000 Shares were issued in exchange for 33.0623 bitcoin and 190.3706 ether. No shares were redeemed during the period. The Fund’s NAV per Share began the period at $25.13 and ended the period at $27.11. The 7.88% increase in the Fund's NAV per share from $25.13, from the period from February 20, 2025 (Date of commencement of operations) to $27.11 at June 30, 2025 is directly related to the 10.51% increase in the price of bitcoin and offset by 9.15% decrease in the price of ether over the same period.

Previous wording

Net realized and unrealized loss on investments in Digital Assets for the period ended March 31, 2025, was approximately $405,109 which includes a net realized loss on investments in Digital Assets of $937 and net change in unrealized depreciation on investments in Digital Assets of approximately $404,172. Net realized and unrealized loss on investments in Digital Assets for the period was driven by bitcoin price depreciation from $98,231.15 per bitcoin as of February 20, 2025 (Date of commencement of operations) to $82,956.00 per bitcoin as of March 31, 2025. Net realized and unrealized loss on investments in Digital Assets for the period was also driven by ether price depreciation from $2,752.09 per ether as of February 20, 2025 to $1,834.80 per ether as of March 31, 2025. Net assets increased by approximately $578,629 during the period from February 20, 2025 to March 31, 2025, to approximately $3,092,007 as of March 31, 2025. The increase in net assets primarily resulted from net capital share transactions of approximately $983,738.

Current wording

Net realized and change in unrealized appreciation (depreciation) on investment in Digital Assets for the period ended June 30, 2025, was approximately $569,094 which includes a net realized gain (loss) on investments in Digital Assets sold for rebalancing of $209 and net change in unrealized appreciation (depreciation) on investment in Digital Assets of approximately $568,885. Net realized and unrealized gain (loss) on investments in Digital Assets for the period was driven by bitcoin price appreciation from $98,231.15 per bitcoin as of February 20, 2025 (Date of commencement of operations) to $108,560.00 per bitcoin as of June 30, 2025 and ether price depreciation from $2,752.09 per ether as of February 20, 2025 to $2,500.31 per ether as of June 30, 2025. Net assets increased to approximately $4,066,210 on June 30, 2025. The increase in net assets primarily resulted from the aforementioned Digital Assets price movement and net capital share transactions of approximately $983,738.

Previous wording

The Sponsor’s fee, which is compensation for the Sponsor’s services rendered to the Fund, is calculated and accrued daily at an annualized rate equal to 0.19% (i.e., 0.19%/365 days) of the net asset value of the Fund and is payable at least quarterly in arrears in U.S. dollars. The Sponsor may, at its sole discretion and from time to time, waive all or a portion of the Sponsor’s fee for stated periods of time. The Sponsor is under no obligation to waive any portion of its fees and any such waiver shall create no obligation to waive any such fees during any period not covered by the waiver. For the period from February 20, 2025 (the day the Shares were initially listed on the Exchange) to August 29, 2025, the Sponsor agreed to waive the entire Sponsor’s Fee on the first $10.0 billion of the Fund’s assets. For the quarter ended March 31, 2026, the Fund accrued the Sponsor’s Fee of $4,548. In the future, if the Sponsor decides to waive all or a portion of the Sponsor’s Fee, Shareholders will be notified in a prospectus supplement or on the Sponsor’s website for the Fund.

Current wording

The Sponsor’s fee, which is compensation for the Sponsor’s services rendered to the Fund, is calculated and accrued daily at an annualized rate equal to 0.19% (i.e., 0.19%/365 days) of the net asset value of the Fund and is payable at least quarterly in arrears in U.S. dollars. The Sponsor may, at its sole discretion and from time to time, waive all or a portion of the Sponsor’s fee for stated periods of time. The Sponsor is under no obligation to waive any portion of its fees and any such waiver shall create no obligation to waive any such fees during any period not covered by the waiver. For the period from February 20, 2025 (the day the Shares were initially listed on the Exchange) to August 29, 2025, the Sponsor agreed to waive the entire Sponsor’s Fee on the first $10.0 billion of the Fund’s assets. For the quarter ended June 30, 2026, the Fund accrued the Sponsor’s Fee of $5,401. In the future, if the Sponsor decides to waive all or a portion of the Sponsor’s Fee, Shareholders will be notified in a prospectus supplement or on the Sponsor’s website for the Fund.