Grayscale Puts SOL, XRP, & AVAX ETF in Play in Request to SEC

• Grayscale makes XRP, SOL & AVAX mainstream in a mixed ETF offer.
• The Securities and Exchange Commission granted BTC & ETH ETFs in 2024.
• A survey asserts that crypto-powered ETFs are increasing demand in the U.S.

Grayscale, the largest asset management company in the Bitcoin exchange-traded fund (ETF) field, is making huge strides in launching a new, mixed crypto ETF. The latest court filings show that Grayscale Investments seeks to convert its Digital Large Cap Fund into an ETF.

Grayscale Seeks Nod for Mixed ETF

By filing a 19b-4 form with the United States Securities and Exchange Commission (SEC), Grayscale requests permission to convert the digital fund to a viable ETF product. This would allow the fund’s crypto components to be traded as part of the $10.6B-worth company’s mixed crypto ETF .

These include Bitcoin (BTC), Ethereum (ETH), Solana (SOL), Ripple (XRP), and Avalanche (AVAX) . Currently, at $23.15 per share, the Grayscale Digital Large Cap Fund LLC (GDLC) has returned investors 33.35% year-to-date. The last three months have been outstandingly successful, with an over 10% upswing.

In January, Grayscale secured the groundbreaking approval of a Bitcoin exchange-traded fund. Half a year later, in June 2024, Grayscale issued a Grayscale Ethereum Trust-based ETF product. Similarly to Canary Capital, Grayscale also penned an application for a separate XRP ETF .

Crypto-Based ETF Demand Flourishes

Currently, Grayscale is ambitiously moving to produce a mixed crypto ETF that includes SOL, XRP, and AVAX as supplementary components to BTC and ETH. Notably, this aligns with comments from industry leaders that ETF market investors have a renewed interest in crypto-based products.

According to a survey conducted by Charles Schwab Corporation, 45% of the ETF investor audience is keen on investing in cryptocurrency ETF products in the future. This trend could be solidified by more altcoin choices in ETFs, particularly SOL, XRP, and AVAX, only trailing behind U.S. equity.

On the Flipside

• The SEC considers Solana (SOL) and Ripple (XRP) securities, imposing extra challenges on Grayscale’s issuance of mixed crypto ETF products.
• In April, Grayscale’s Digital Large Cap Fund included Cardano (ADA) and Polygon (MATIC), but the altcoins were replaced with XRP and AVAX.

Why This Matters

Entrance into traditional financial markets gives the qualifying altcoins an edge over competitors in accessibility and compliance, offering investors a regulated way to interact with the asset.

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