Franklin Templeton Digital Holdings Trust

At June 30, 2024, the Custodian held 5,886.9982 of bitcoin on behalf of the Fund, with a market value of $373,054,955 (cost: $348,236,796) based on the price of bitcoin (as measured by the Lukka Prime Price) at period end.

For the quarter ended June 30, 2024*

For the quarter ended June 30, 2024, 2,800,000 Shares were issued in exchange for 1,623.9995 of bitcoin and 1,000,000 Shares were redeemed in exchange for (579.9999) of bitcoin. The Fund’s NAV per Share began the period at $40.95 and ended the period at $36.75. The decrease in NAV per Share was due to a lower price of bitcoin of $63,369.30 at period end, which represented a decrease of 10.26% from $70,596.99 at March 31, 2024.

The change in net assets from operations for the quarter ended June 30, 2024 was $(36,290,278), which was due to (i) payment of the Sponsor’s Fee of $(175,683), (ii) Less waiver and reimbursement of $175,683, and (iii) a net change in realized gain (loss) from bitcoin sold for redemptions and unrealized appreciation on investment in bitcoin of $(36,290,278).

Liquidity and Capital Resources

The Fund is not aware of any trends, demands, commitments, events, or uncertainties that are reasonably likely to result in material changes to its liquidity needs.

The Fund’s only ordinary recurring expense is expected to be the Sponsor’s fee. In exchange for the Sponsor’s fee, the Sponsor has agreed to assume the ordinary fees and expenses incurred by the Fund, including but not limited to the following: the fees charged by the Administrator, Marketing Agent, the Custodians and the Trustee, Cboe BZX Exchange listing fees, typical maintenance and transaction fees of the DTC, SEC registration fees, printing and mailing costs, tax reporting fees, audit fees, license fees and expenses, and up to $500,000 per annum in ordinary legal fees and expenses. The Sponsor will also pay the costs of the Fund’s organization and the initial offering costs, and may not seek reimbursement of such costs.

The Sponsor’s fee is accrued daily at an annualized rate equal to 0.19% of the net asset value of the Fund and is payable at least quarterly in arrears in U.S. dollars orin-kind or any combination thereof. 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. The Fund will sell bitcoin as needed to pay the Sponsor’s fee. For a period from January 12, 2024 to August 2, 2024, the Sponsor agreed to waive a portion of the Sponsor’s Fee so that the Sponsor’s Fee after the fee waiver will be equal to 0.00% of the net asset value of the Fund for the first $10.0 billion of the Fund’s assets. For the period April 1, 2024 to June 30, 2024, the Fund accrued the Sponsor’s Fee of $175,683 less waiver and reimbursement of $175,683, the net Sponsor’s Fee payable post waiver and reimbursement is $0. 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, in the Fund’s periodic reports and/ or on the Sponsor’s website for the Fund.

The Fund bears transaction costs, including any bitcoin network fees or other similar transaction fees, in connection with any sales of bitcoin necessary to pay the Sponsor’s fee, as well as other Fund expenses (if any) that are not assumed by the Sponsor (expenses assumed by the Sponsor are specified above). Any bitcoin network fees and similar transaction fees incurred in connection with the creation or redemption of Creation Units are borne by the Authorized Participant.

Off-Balance Sheet Arrangements

At June 30, 2024, the Fund as well as the Trust do not have anyoff-balance sheet arrangements.

Historical Digital Asset Holdings and Bitcoin Prices

Analysis of Movements in the Price of Bitcoin

As movements in the price of bitcoin are expected to directly affect the price of the Fund’s shares, it is important for investors to understand and follow movements in the price of bitcoin. Past movements in the bitcoin price are not indicators of future movements.

The following chart shows movements in the price of bitcoin based on the CME CF Bitcoin Reference Rate – New York Variant for the Bitcoin – U.S. Dollar trading pair (the “CF Benchmarks Index”) in U.S. dollars per unit over the period from April 1, 2024 to June 30, 2024.

The average, high, low and end-of-period bitcoin prices based on the CF Benchmarks Index for the period are as below: