Grayscale Investments®(OTCQX: GDLC), an asset management firm specializing in crypto investing offering more than 25 crypto investment products, has announced a significant milestone for its Grayscale Digital Large Cap Fund (GDLC). The application to uplist GDLC as an Exchange-Traded Product (ETP) has been officially published in the Federal Register, marking the initiation of a review process that could take up to 240 days. This development is poised to reshape the landscape of digital asset investment by allowing broader access to multi-crypto asset ETPs.
The proposed rule change, submitted by NYSE Arca, Inc., is encapsulated in Form 19b-4. It aims to redefine how ETPs that hold commodities and digital assets, beyond just Bitcoin and Ether, are categorized. If approved, this would establish the first national securities exchange ruleset for listing and trading shares of multi-crypto asset ETPs under NYSE Arca Rule 8.800-E.
Peter Mintzberg, CEO of Grayscale, emphasized the firm’s commitment to innovation in digital asset investing. He stated, “As investors seek to maximize risk-adjusted returns and build financial portfolios that can adapt to market shifts, they are increasingly allocating to digital assets”. This sentiment reflects a growing trend among investors looking for diversified exposure in their portfolios.
As of November 1, 2024, GDLC boasts over $530 million in assets under management. The fund’s portfolio includes a selection of large-cap digital assets from the CoinDesk Large Cap Select Index (DLCS), which is rebalanced quarterly. The current asset allocation are Bitcoin: 76.53%, Ether: 16.92%, Solana: 4.36%, XRP: 1.63% and Avalanche: 0.56%.
David LaValle, Grayscale’s Global Head of ETFs, noted that GDLC continues to meet investor demand for diversified exposure to cryptocurrencies through its carefully curated portfolio.
The proposed rule change stipulates that funds invested in a diversified basket index must allocate at least 90% of their investments in commodities with established surveillance or futures markets, such as Bitcoin and Ether. Up to 10% can be allocated to other digital assets. This framework is designed to enhance investor confidence and regulatory compliance while providing a structured approach for investing in cryptocurrencies.
If approved, this rule change would not only benefit GDLC but also set a precedent for other multi-crypto asset ETPs seeking similar listings on national exchanges. Grayscale’s proactive engagement with regulators aims to bring digital assets further into the U.S. regulatory perimeter, enhancing transparency and investor protection.
GDLC is an SEC-reporting entity that has consistently focused on developing regulated investment vehicles that cater to the needs of modern investors seeking exposure to digital assets. Grayscale offers various products tailored for accredited investors, including thematic funds and single-asset trusts focused on specific cryptocurrencies like Avalanche and XRP. This diverse product lineup underscores Grayscale’s strategy to adapt and grow within the rapidly evolving crypto landscape.
The publication of Grayscale’s application to uplist GDLC as an Exchange-Traded Product marks a pivotal moment for both the firm and the broader cryptocurrency market. As regulatory frameworks evolve, Grayscale remains committed to pioneering innovative investment solutions that meet the growing demand for digital asset exposure.
