The world’s largest crypto fund manager is offering new trusts that invest in 5 different cryptocurrencies

Photo illustration of visual representations of digital cryptocurrencies
  • Grayscale Investments is offering new trusts that invest in five different cryptocurrencies.
  • The new trusts will invest in Basic Attention and Decentraland tokens, Chainlink, Filecoin, and Livepeer.
  • Investor demand for digital currencies has never been higher, Grayscale CEO Michael Sonnenshein said.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

Digital currency asset manager Grayscale Investments announced Wednesday that it is offering five new investment trusts, bringing its single-asset lineup to 13.

The new trusts are launching into fairly niche segments of the crypto space, with three investing in Chainlink, Filecoin, and Livepeer, which are blockchain-based digital payment systems. One will invest in Ethereum-based Basic Attention tokens, while the fifth will hold coins in the virtual reality platform Decentraland. These trusts are among the first of their kind to solely invest in the digital currencies underlying each investment product.

“Digital currencies have reached an inflection point,” Grayscale CEO Michael Sonnenshein said in a statement. “Investor demand has never been higher, and every day we’re seeing new entrants to what has surely become a bona fide asset class.”

Decentraland is an Ethereum-based blockchain platform where users can operate VR applications.

Grayscale said all five trusts are open for subscription by eligible individual and institutional accredited investors. The decision to launch them was based on assessment of investor demand and the integrity of each cryptocurrency, Sonnenshein told Bloomberg in an interview. The asset manager’s biggest product is still its $34 billion Grayscale Bitcoin Trust.

The new cryptocurrencies it has chosen have much smaller market values in comparison to bitcoin. Basic Attention tokens are known to track consumers’ time and attention on websites, with the goal of understanding how to efficiently distribute advertising money.

Chainlink runs on the Ethereum blockchain, with a technology that enables delivery of price feeds into decentralized finance applications. Filecoin is a storage service provider that enables anyone to rent spare storage space on their computer, creating a huge source of data storage.

Livepeer is a decentralized video-streaming network for those who wish to add live or in-demand video to their networks. Meanwhile, Decentraland tokens can be used to buy up virtual plots of land and goods and services within its virtual-reality space.

Grayscale said it plans to continue a tradition of creating “novel pathways” for investors to access the opportunities that digital currencies may offer.

Read the original article on Business Insider

The world’s biggest crypto fund manager is hiring 9 ETF-related specialists, in anticipation of approval of the first US crypto ETF

Michael Sonnenshein.JPG
Michael Sonnenshein, managing director of Grayscale Investments.

  • Grayscale Investments is hiring an ETF team, in a sign it expects the US to approve crypto exchange-traded funds.
  • The digital asset manager doesn’t currently have an active filing with the SEC for a crypto-related ETF.
  • Canada has already approved three cryptocurrency ETFs that trade on the Toronto stock exchange.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

Grayscale Investments, the largest digital currency asset manager, has posted nine ETF-related job ads on LinkedIn, in a sign it expects the Securities and Exchange Commission to approve the first US crypto ETF.

Crypto ETFs have been hotly debated in the US ever since the Winklevoss twins’ filing of their bitcoin ETF with the SEC was rejected in 2017. The SEC has so far been arguing that the crypto market is too volatile, lacks sufficient surveillance, and is easily manipulated.

The US regulator is now considering ETF applications from WisdomTree, NYDIG, VanEck, and Valkyrie Digital Assets. Grayscale has filed to launch an ETF in the past, but it does not currently have an active filing with the SEC for a bitcoin, or crypto-related ETF. However, it could push its $35 billion Bitcoin Trust, the largest of its kind, into an ETF.

“We’re not able to provide further detail aside from the fact that we are continuously exploring new opportunities, such as an ETF, in response to customer demand,” Michael Sonnenshein, Grayscale’s CEO and managing director, told Bloomberg. “We were the first to provide exposure to a digital asset through a regulated wrapper, and our goal is to ensure that we lead the market in whatever future product we bring forward as well.”

Grayscale’s new roles require between three and five years experience in financial positions involving exchange-traded funds. The job postings as seen on LinkedIn currently include an ETF market-maker relationship manager, an ETF finance reporting manager, ETF finance support manager, ETF creation and redemption specialist, ETF authorized participant relationship manager, ETF product development specialist, a compliance officer, and two sales director positions.

Regulated ETFs aren’t too far away, as Canada approved three publicly-traded bitcoin ETFs within the last month that trade on the Toronto Stock Exchange.

Ark Invest’s Cathie Wood told CNBC in February she expects the US to greenlight a bitcoin ETF, as she’s confident in President Joe Biden’s pick for SEC chairman, Gary Gensler, who is seen as a positive for cryptocurrencies. The Senate banking committee on Thursday voted in favour of sending Gensler‘s nomination to the floor for confirmation.

Read the original article on Business Insider

The Grayscale Bitcoin Trust’s recent plunge has its shares trading at a discount to the cryptocurrency

GettyImages 1231348986
The Grayscale Bitcoin Trust has fallen sharply along with the cryptocurrency itself

  • The Grayscale Bitcoin Trust plunged this week as the price of bitcoin has tumbled.
  • The trust’s share price closed at a 3.77% discount on Thursday, a sharp reversal from recent hefty premiums.
  • The bitcoin price itself has plunged around 20% this week, the biggest weekly drop since March 2020.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

The Grayscale Bitcoin Trust’s shares have plunged almost 20% this week, marking the biggest drop in the world’s largest bitcoin fund in close to a year.

Grayscale’s closing price of $45.64 on Thursday meant the fund’s public shares had fallen more than bitcoin itself over the week.

The trust’s shares closed at a 3.77% discount to net asset value on Thursday, a sharp reversal after trading at hefty premiums as the bitcoin price soared in recent months. It is the first discount since March 2017, according to Bloomberg data.

Investors have sold shares in the Grayscale Trust at a rapid rate over recent days as bitcoin has tumbled from a high of $58,000 on Sunday. The fund has a total of $32.83 billion in assets under management, according to Bloomberg.

The fall into discount territory highlights the extent to which investors have cooled on the fund this week. Its public shares traded at premiums above 15% for much of January as investors used the fund as a key way to gain exposure to bitcoin.

Bitcoin was down around 8.6% to $46,669 as of 9.25 a.m. ET on Friday. It had shed close to 20% over the week, the worst decline since March last year, as investors balk at the sky-high price.

Yet most bitcoin bulls are unconcerned about the recent drop. They argue it represents a good buying opportunity and predict that the price will continue to pull higher.

Katharine Wooller, managing director of UK digital asset exchange Dacxi, told Insider that corporate interest from the likes of Tesla should keep supporting bitcoin.

“Be warned however, bitcoin is known to significantly correct,” she said. “Whilst the medium trend is positive for holders, it is both the sign of a healthy market and a buying opportunity.”

Grayscale chief executive said that it was “certainly a risk” that the GBTC’s premium disappears, at the Bloomberg Crypto Summit on Thursday.

“But ultimately price discovery in GBTC every day is driven entirely by market forces,” he said.

(This article has been corrected. It previously said there had been large outflows from GBTC, when in fact the Trust does not operate a redemption program.)

Read the original article on Business Insider

Cathie Wood’s ARK Invest now holds more than 7 million shares in the Grayscale Bitcoin Trust

Cathie Wood

The asset manager ARK Invest boosted its holdings in the Grayscale Bitcoin Trust in the fourth quarter of 2020, according to a recent filing with the Securities and Exchange Commission.

Cathie Wood’s ARK, which manages assets of about $50 billion, bought 2.14 million additional shares in Grayscale’s digital-currency investment product, bringing its total holdings to 7.31 million shares.

Grayscale Bitcoin Trust, the world’s largest bitcoin fund and the first of its kind, enables investors to speculate on and gain exposure to bitcoin in the form of a security without having to buy or store the digital token directly. Shares in the investment vehicle are part of a range of traditional finance products that track bitcoin prices.

The trust holds over 649,130 bitcoins, or roughly 3.1% of bitcoin’s supply, according to CoinDesk. Its website says its assets under management are about $31 billion.

As of Tuesday, ARK’s new share position in the Grayscale product was about $351 million. The firm’s Next Generation Internet ETF holds shares in the trust.

Read more: GOLDMAN SACHS: These 40 heavily shorted stocks could be the next GameStop if retail traders target them – and the group has already nearly doubled over the past 3 months

The price of bitcoin rose to $49,998 on Tuesday before slipping back. Interest from Wall Street institutions added momentum to its rally.

Wood predicted earlier this month that bitcoin would shoot higher this year. “Bitcoin is only [at] roughly a $600 billion market cap,” she told Yahoo Finance. “So even half the size of Apple or Amazon, right now. Doesn’t that put it into perspective? And yet, it is a very big idea, I think. A much bigger idea than Apple or Amazon.”

ARK has five exchange-traded funds run by Wood and her team of analysts that actively invest in companies they believe will change the world through “disruptive innovation.”

Other companies that Ark invested in during the fourth quarter were Tesla, Square, Roku, Pinterest, DocuSign, Alibaba, Snapchat, PayPal, and Netflix.

Read more: Canadian regulators just approved the world’s first Bitcoin ETF. Here are the 5 things investors need to know about the outlook for a US version.

Read the original article on Business Insider