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Grayscale Unveils New DeFi Fund For Institutional Clients

Other 2021/07/19 22:23 by Brenda Ngari
Grayscale Wants To Convert GBTC Into A Bitcoin ETF

Grayscale Investments LLC is launching its 15th investment product, a DeFi fund, and index focused on the snowballing decentralized finance (DeFi) sector. This is according to an announcement made by the firm’s CEO on Monday.

Grayscale Launches New Institutional-Grade DeFi Fund

Michael Sonnenshein, the CEO of the world’s largest digital asset manager Grayscale said during an interview with CNBC’s Squawk Box that the firm has started a fund targeting DeFi tokens such as Uniswap (UNI) and Aave (AAVE) for its institutional accredited customers. 

The new fund will be based on a DeFi-particular index created by CoinDesk’s TradeBlock. The index tracks 10 DeFi blue chips namely Uniswap (UNI), Yearn Finance (YFI), Bancor (BNT), Aave (AAVE), Synthetix (SNX),  MakerDAO (MKR), Compound (COMP), SushiSwap (SUSHI), Curve (CRV), and UMA Protocol (UMA) as of July 1. 

The CEO explained that the rising interest in popular crypto assets in the decentralized finance ecosystem as well as the growing user adoption in DeFi protocols prompted Grayscale to create the DeFi fund. He added:

“The emergence of decentralized finance protocols provide clear examples of technologies that can redefine the future of the financial services industry. We’re proud to offer investors exposure to DeFi through Grayscale’s trusted, secure, and industry-leading investment product structures.”

Grayscale is a subsidiary of Barry Silbert’s Digital Currency Group and has emerged as a key player in the cryptocurrency market with tens of billions of assets under management. The various cryptocurrency trusts controlled by the firm are quite popular among institutional investors who like having crypto exposure without having to hold the assets directly.

“Bitcoin ETF In The U.S. Is A ‘Matter Of When, Not If’”: Grayscale CEO

During the CNBC interview, Sonnenshein also spoke about the topic of a Bitcoin exchange-traded fund (ETF). Regarding this matter, he noted that a bitcoin ETF in the United States is “a matter of when, not a matter of if”.

The Grayscale chief noted that the firm tapped BNY Mellon last Friday as an asset servicing provider in its preparation to convert its flagship Bitcoin Trust into an ETF. Per Sonnenshein, the giant crypto asset manager is 100% committed to transforming the GBTC into a Bitcoin ETF.

To date, no Bitcoin ETFs have been greenlighted in the United States. Sonnenshein, however, suggests that the Securities and Exchange Commission  Commission (SEC) will eventually approve a Bitcoin once the cryptocurrency market becomes more mature.

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