Originally published on: November 04, 2024
Asset manager Grayscale has submitted a request to US regulators to approve the first-ever exchange-traded fund (ETF) that would hold a diverse portfolio of cryptocurrencies, including popular altcoins. The Securities and Exchange Commission is currently reviewing the proposal put forward by the NYSE Arca to list shares of the Grayscale Digital Large Cap Fund (GDLC).
If the proposed rule change is accepted, it would mark a significant milestone as the first national securities exchange to allow the trading of shares of multi-crypto asset ETFs. The GDLC fund comprises a crypto index portfolio featuring Bitcoin, Ether, Solana, Avalanche, and XRP. Despite being established in 2018, the fund is not yet available for trading on public exchanges and holds around $534 million in assets under management as of November 4.
Grayscale faces competition from other asset managers such as Hashdex and Franklin Templeton, who have also proposed index funds, but GDLC stands out by including altcoins like Solana, Avalanche, and XRP in its holdings. Analysts predict that crypto index ETFs are the next big trend following the successful listing of BTC and ETH ETFs earlier this year.
Experts believe that index ETFs are the logical next step for investors looking to diversify their crypto portfolios, much like purchasing traditional index funds like the S&P 500. With a growing interest in altcoin ETFs, the industry is evolving rapidly to meet the demands of investors looking to capitalize on the crypto market.
Grayscale and NYSE Arca have solicited feedback on their proposed ruleset, aiming to provide investors with access to a wide range of crypto assets through ETFs. As the regulatory process unfolds over the next 240 days, the crypto community eagerly anticipates the approval of the Grayscale crypto index ETF and the opportunities it will bring to the market.
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