Grayscale wants to convert its mixed-crypto fund into an ETF

• Grayscale filed to convert its $524M Digital Large Cap Fund into an ETF.
• The fund includes BTC, ETH, Solana, XRP, and Avalanche among its holdings.
• This is Grayscale’s third ETF conversion after its Bitcoin and Ethereum funds.

Grayscale Investments has taken a significant step toward expanding its suite of cryptocurrency-based financial products by filing with the US Securities and Exchange Commission (SEC) to convert its Digital Large Cap Fund (GDLC) into an exchange-traded fund (ETF).

The GDLC, which currently trades over the counter, offers diversified exposure to several leading digital assets, including Bitcoin (BTC), Ether (ETH), Solana (SOL), Ripple (XRP), and Avalanche (AVAX).

Grayscale’s move marks a continued effort by Grayscale to make cryptocurrency investments more accessible to traditional investors.

Grayscale’s Digital Large Cap Fund (GDLC)

According to the company’s report, the fund has $524 million in assets under management, with a significant concentration in Bitcoin and Ethereum, which make up nearly 75% and 19% of the holdings, respectively.

The remaining portion is allocated to Solana, XRP, and Avalanche, providing investors with a balanced exposure to established and emerging cryptocurrencies.

The third time Grayscale is converting a fund into an ETF

If approved, the ETF would represent Grayscale’s third conversion of a fund into an ETF, following its previous transitions of Bitcoin and Ethereum funds earlier this year.

A spokesperson from Grayscale emphasized that the filing reflects the firm’s commitment to enhancing the accessibility of the crypto asset class for mainstream investors.

The company aims to leverage the regulatory structure of an ETF to offer a more efficient and widely accepted investment vehicle, which could attract additional interest from institutional and retail investors.

In parallel with Grayscale’s move, the market has seen a surge in ETF filings for various crypto assets.

Recently, Bitwise submitted an application to the SEC seeking permission to list a spot XRP ETF and Canary Capital submitted applications to list XRP and Litecoin ETFs. However, these filings have yet to receive approval, underscoring the regulatory uncertainty surrounding crypto-based ETFs in the United States.

Grayscale’s initiative to convert GDLC into an ETF aligns with its broader strategy of offering products that bridge the gap between traditional finance and the evolving digital asset landscape.

Alongside its proposed conversion, the firm has also introduced funds that provide exposure to XRP and the AAVE governance token, reflecting its proactive approach to navigating the competitive and regulatory dynamics of the crypto market.