Grayscale's ETF Ambitions
Grayscale Investments, a leading issuer of Bitcoin ETFs, has officially filed to convert its Digital Large Cap Fund into a publicly traded exchange-traded fund (ETF). This fund currently holds significant assets in Bitcoin, Ethereum, XRP, Solana, and Cardano.
Fund Composition
The fund is predominantly weighted towards Bitcoin, comprising 79.4% of its assets. The breakdown is as follows:
- Ethereum: 10.69%
- XRP: 5.85%
- Solana: 2.92%
- Cardano: 1.14%
Cardano was added to the fund recently, replacing Avalanche due to rebalancing. Since its launch in 2018, the fund has seen a remarkable 478.83% increase in market price, according to Grayscale's reports.
Regulatory Filing and Market Impact
The recent S-3 form submitted to the U.S. Securities and Exchange Commission (SEC) aims to retain much of the fund's structure while making it more accessible. This conversion could open doors for everyday investors to engage with the crypto market, with the fund reportedly covering about 75% of the digital asset market cap, excluding meme coins and stablecoins.
Previously, only accredited investors could participate in Grayscale's Digital Large Cap Fund. The ETF transformation would eliminate this restriction, allowing broader access.
The Growing ETF Landscape
Since the approval of the first Bitcoin spot ETFs in January 2024, there has been a surge in crypto ETF applications. U.S. Bitcoin ETFs currently manage $97.27 billion, while Ethereum ETFs hold $8.59 billion in assets, as per CoinGlass.
With the recent political shifts, many issuers are optimistic about a new regulatory environment and are filing for various novel crypto funds, including those for Dogecoin and Trump meme coins. However, these have yet to receive approval.
Market Predictions
Bloomberg's senior ETF analyst speculated that the anticipated DOGE and TRUMP ETFs could launch by early April, although public sentiment suggests skepticism about their timely approval.
Edited by Stacy Elliott.
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