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Grayscale Investments

Grayscale Creates New Record While Its Litecoin product Secures Third-Spot

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Litecoin [LTC] has seen some handsome gains over the past several weeks. Thanks to the continued bullish momentum, the cryptocurrency has now climbed to be the third-largest spot with respect to crypto holding by Grayscale Investments, which happens to be the world’s leading crypto asset management.

Grayscale Litecoin Trust’s  [LTCN] AUM was found to be at $74.8 million trailing behind Grayscale Bitcoin Trust [GBTC] at $10,821 million and Grayscale Ethereum Trust [ETHE] at $1,722 million. As LTCN steadily increased, it surpassed Grayscale Ethereum Classic Trust [ETCG] to secure the third position.

Litecoin Demonstrates Bullish Momentum As It Breaks Several Barriers

First launched in March, Grayscale Litecoin Trust became publicly available in August of this year. Prior to this only accredited investors were able to participate in it. Thanks to the price appreciation of the underlying cryptocurrency, LTCE scored massive investments’ inflow in the third quarter of the year, 1,800% to be specific.

This news comes a month after reports of Grayscale’s Litecoin Trust attracting massive capital inflows emerged. As noted above, the reason for this could be attributed to the positive price action of LTC/USD.  Litecoin has been on a bullish spree along with Bitcoin [BTC] and its peer altcoins this season. It surged all the way to the fifth spot on the cryptocurrency ladder blasting past Bitcoin Cash [BCH] as well Chainlink [LINK].

At the time of writing, LTC was being traded at $81.33.

Reportedly, Grayscale’s Litecoin Trust was found to be trading with a significant premium to spot prices. To top that, LTCN Premium recently scaled above 2300%. This level was recorded as the highest among the Grayscale products.

This positive momentum essentially indicated that market participants, investors, hedge funds, were eyeing to increase their LTC exposure.

Record For Grayscale

With this, Grayscale Investments has become the fastest growing asset manager. It has crossed a whopping $13 billion in assets under management [AUM] on the 15th of December. It has managed to add $1 billion worth of inflows in less than a month, benefiting from the revival of the cryptocurrency industry.

The platform had earlier reported that it had $12.1 million in AUM just a couple of days ago.

Barry Silbert, the CEO of Grayscale’s parent company Digital Currency Group, tweeted,

“Record AUM for Grayscale…$13 billion. Grayscale AUM on Nov 1: $7.6 billion Grayscale AUM today: $13.0 billion”

Grayscale Report Shows Evidence That Investors Were Regaining Trust in Crypto Market; GBTC Holdings Surge

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The cryptocurrency market’s resurgence over the past few weeks has kick-started significant asset movements on major exchanges. As the world comes to terms with dealing with life in quarantine, the market fluctuations represent the growing investor’s interest across the board.

Grayscale Investments, one of the largest and most popular cryptocurrency investment companies recently announced that over the past few weeks, the amount of holdings had increased steadily.  A calculation by the company showed that the total Assets Under Management had increased to a whopping $6.1 billion. 

According to Grayscale, a majority of the investments had flow into the Grayscale Bitcoin Trust. Bitcoin’s bullish performance over the past few had instilled confidence among its holders, who have brought into the market once again. The Bitcoin aspect of the trust amounted to $5037 million with a 3.2 percent increase on the daily. . The market price per share was calculated to be $14.75 percent while the holdings per share came to $11.6.

After Bitcoin, Bitcoin Cash held the major Grayscale repository with a $30.7 million hold in the trust. The BCH holdings per share were $2.94 percent with a 6.91 percent change every day. Bitcoin Cash’s volatility was one of the largest when compared to Bitcoin and Ethereum. Ethereum made up the the podium in Grayscale’s investment fund. The world’s largest altcoin had a total holding of $876. 6 million with a daily change of $1.61 percent. Ethereum’s market share held a healthy $83.9, which was the largest among its compatriots.

Grayscale’s Litecoin holdings were lesser than that of Ethereum Classic’s, Ethereum’s hard fork that has surprisingly made a positive impact in some areas. ETCG had a holdings per-share value of $6.64 while the daily change was 6.58 percent. At the same time, Litecoin’s Grayscale AUM amounted to $19.8 million at a daily rate change of 13.91 percent.

The Trusts by Grayscale are open-ended and sponsored by the company. Their main intention is to enable exposure to the price of movement of each trust’s underlying assets. This process avoids the challenges of storing, buying and safekeeping any of the aforementioned digital assets.

Grayscale Bought 50% of Ethereum Minted in 2020 as ETH 2.0 Testnet Garners Positive Response

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Ethereum is currently witnessing one of its most engaging periods in the industry. During the month of March, the coin suffered a major setback but the largest altcoin asset was able to rally back into a strong position.

Now, according to recent reports, Grayscale, one of the largest digital asset manager firm in the industry, is identifying Ethereum’s potential in space, regardless of its recent price scare. A recent Reddit post indicated that Grayscale’s investments had bought close to 50 percent of the Ether mined in 2020. The statistics indicate that the company currently holds 1.1% of the total Eth in the circulating supply.

Grayscale buying Ethereum left and right

According to data, a total of 1,563,245,875 ETHs were mined in 2020 from 1 January to 24 April. During the same period, it was observed that the number of shares issued to the Grayscale Investments Ethereum Trust (ETHE) was 13,255,400 on 24 April. The number was approximately 5,230,200 on 31 December.

On calculating the data, it was analyzed that approximately 756,240 ETH was bought which precisely meant ETHE bought around 49% of the total ETH mined.

Additionally, During the first quarter of 2020, Ethereum Trust accounted for a  $110M of inflows, which is more than all previous inflows combined for the past two years ($95.8M). That is a substantial increase, which suggested that the interest in ETH futures is likely more than what the community expected.

ETHE

Grayscale Ethereum Trust shares are some of the first securities solely invested in and derived from the valuation of Ethereum. The Trust allows its investors to gain exposure and experience with ETH’s price movements through a traditional investment vehicle. Traders and Investors are able to incur the profitability of trading without the challenges of buying, storing, and housing their ETH funds.

At the time of writing, Grayscale currently operated 10 different cryptocurrency investment products focused on institutional investors.

Ethereum 2.0 is gaining attention?

Previously, it was reported that the number of Ethereum validators was also on the rise following the launch of the recent ETH 2.0 testnet. The upcoming release of Ethereum 2.0, which will complete the migration from the current proof-of-work consensus algorithm to the proof-of-stake algorithm. It could be one of the main reasons behind the high level of buying at the current moment.

At press time, Ethereum’s valuation remained under the $200 range at $195 but it could soon breach above the $200 once again. Its market capitalization remained under $22 billion with a trading volume of $18 billion over the past day.

Will the Bitcoin ETF Get Approved in 2020 as an Institutional Demand Increase?

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Over the last few years, a particular bitcoin discussion that has repeatedly made headlines is about the Bitcoin ETF. On the downside, the headlines have mainly painted the words ‘rejection’ and ‘SEC.‘

Since 2019, a list of notable institutions and firms has forwarded their proposal for a Bitcoin ETF to the U.S. Securities and Exchange Commissions. However, the result has always been the same as the SEC kept shooting down all the filings. The latest to bite the dust came from Wilshire Pheonix in March 2020 and the firm expressed its disappointment after the SEC had rejected their proposal.

Despite the fact that the Bitcoin ETF is being played out, again and again, it is important to note that the institutional funds have not stopped flowing in.

Accredited interest in Bitcoin and a possible ETF

As previously reported, the 1st Bitcoin index fund in Hong Kong underlined the fact that accredited investors had raised the demand for Bitcoin in the markets. The interest can also be identified from Grayscale’s recent Q1 2020 report.

According to the Grayscale, in spite of the current global financial meltdown, an allocation of over $389 million was made into the Grayscale Bitcoin Trust or GBTC from January to March 2020. The report suggested,

“88% of inflows this quarter came from institutional investors, the overwhelming majority of which were hedge funds. The mandate and strategic focus of these funds is broadly mixed and includes Multi-Strat, Global Macro, Arbitrage, Long/Short Equity, Event Driven, and Crypto-focused funds.”

With respect to the above data, a legitimate case can be made that the Bitcoin ETF could be approved in 2020. The major reason for the approval of an ETF would come down to the reduction of premium rates.

Longhash’s recent report had suggested that accredited users are used to trading Bitcoin at a whopping 30 percent in GBTC. That means, if the market price of Bitcoin would be traded at $10,000, the investors would be investing BTC worth over $13,000 at Grayscale.

Such differences were likely to be removed as some of the past ETFs claimed that a reduction in premiums would be facilitated and standardized pricing would be manifested for the crypto asset.

Grayscale also received a higher premium because there were no alternatives to the Bitcoin ETF other than GBTC. Hence, under high demand, BTC and ETH would consistently trade high premiums on Grayscale.

But now that current institutional interest is on the upswing, the Bitcoin ETF could be quite inevitable. SEC Commissioner, Hester Peirce has also been a vocal supporter of the ETF in the past, as she said in February 2020.

“Permitting institutional investors and regulated exchanges to enter this market would lead to more robust protections for retail investors (who, to be clear, are already active in the underlying spot market), to better custody solutions for Bitcoin, and to more effective surveillance for market manipulation and other fraudulent activity.”

Grayscale’s Barry Silbert Thinks US Will Be The Next BTC Mining Hotspot After China

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China has been a driving force in cryptocurrency adoption, at least in the Asian sector. Several major players were looking at the Red Dragon as the marker for development in the decentralized assets space.

New comments from proponents of the space have now shown that there was a swing occurring where people preferred to conduct mining operations outside China.

Grayscale Investments boss Barry Silbert recently took to the airwaves to inform investors that there was a growing demand of interest from areas outside China. Currently, China dominates digital coin mining and that figure is yet to be challenged.

Grayscale Investments is the world’s biggest cryptocurrency asset manager and its Silbert has made news multiple times while praising Bitcoin.

Silbert is also responsible for the popular ‘DropGold’ campaign that aimed to show that Bitcoin was much better than traditional gold as a form of long term investment.

The Grayscale CEO did not mention the main reasons why there was a shift from China, leaving many to guess. He claimed that over the past three to six months, there was a growing shift in moving mining activities to the US or Canada.

There has been significant competition among countries to establish dominance in the cryptocurrency space. Powerhouses such as Japan have also kept a watchful eye on China and have openly stated that the Xi Jinping led the country was a threat.

Miners in China control sixty-six percent of all Bitcoin mining, which puts the ball squarely in their court. Silbert’s comments are expected to render some hope to investors who believe that the west needs to up its game.

Even though China has the lion’s share when it comes to mining, the country still does not allow digital assets to flourish in its full glory. The laws in the country still state that cryptocurrencies were not fully accepted.

Instead of cryptocurrencies, blockchain technology was considered the real superstar as several companies have begun using it. Officials in China, including the President, had revealed that using blockchain technology was the way to go for the future.

Although Silbert’s comments were positive for the US mainland, miners need to ensure that all the guidelines are met. Reports have shown that there have been several scams in the space and the advent of growth in the mining sector will only elevate that.

 

Bitcoin Expected To Receive More Institutional Investors as Grayscale Investments Gets Recognized By The SEC

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Cryptocurrency companies have been making a name for themselves in the past couple of months with several achieving mainstream status. One of the biggest winners in that category has been Grayscale Bitcoin Trust, the company that launched the famous “DropGold” campaign.

Just recently, Grayscale Investments announced that it has become an SEC reporting company. This comes two months after the company had filed a Registration Statement on Form 10 with the SEC on behalf of Grayscale Bitcoin Trust [GBTC].

Since its inception, Grayscale Bitcoin Trust has grown to become the world’s largest Bitcoin investment product. The company recently released a circular that addressed the organization’s plans for the future now that it was an SEC reporting company.

GBTC claimed that its main directive is to provide Bitcoin services to users without them having to go through the hassle of managing it. This includes challenges such as storing, buying and safekeeping Bitcoin on their own.

The way GBTC works is similar to that of financial and tax advisors, one of the reasons why it was accepted by the SEC. By becoming the first digital investment vehicle to be registered with the SEC, GBTC has broadened Bitcoin’s availability to all US investors.

GBTC’s SEC addition will also allow more institutional investors to get into the Bitcoin field. The entry of institutions was earlier reduced because of the lack of credibility in the eyes of regulatory authorities. According to the Grayscale Investment report:

“While the Trust has historically published quarterly and annual reports as well as audited financial statements pursuant to the OTC Markets Alternative Reporting Standard (ARS), the Trust will now file its quarterly and annual reports as well as audited financial statements as 10-Qs and 10-Ks with the SEC, along with current reports on Form 8-K, in addition to complying with all other obligations under the Exchange Act.”

With the addition of the SEC’s structure, the trust is designed to have its share value reflect the performance of Bitcoin. The company will also have fewer expenses and other liabilities as it is “solely and passively invested in Bitcoin”. According to the report, GBTC will continue to not run the redemption program or trade on a national securities exchange.

The news was also shared by Coinbase Custody as Grayscale Investments was its client. The Brian Armstrong led company was confident that being part of the SEC was an incredible milestone for the entire digital currency market.