United States regulators are reviewing a request to list the first exchange-traded fund (ETF) to hold a diverse basket of cryptocurrencies, including several altcoins, asset manager Grayscale said on Nov. 4.
On Oct. 29, securities exchange NYSE Arca asked the Securities and Exchange Commission for permission to list shares of Grayscale Digital Large Cap Fund (GDLC).
“[T]he proposed rule change, if adopted, would represent the first national securities exchange ruleset permitting the listing and trading of shares of multi-crypto asset [ETFs],” Grayscale said.
The fund holds a crypto index portfolio comprising Bitcoin (BTC), Ether (ETH), Solana (SOL), Avalanche (AVAX) and XRP (XRP). It was created in 2018 but is not yet tradeable on public exchanges.
GDLC holds approximately $534 million in assets under management (AUM) as of Nov. 4, according to Grayscale’s website.
GLDC’s holdings. Source: Grayscale
Related: SOL, XRP ETF filings are ‘call options’ on Trump win: Bloomberg analyst
Grayscale filed to convert the fund into an ETF on Oct. 16, only days before NYSE’s filing.
On Nov. 4, the NYSE’s requested rule change was published in the federal register, starting a 240-day clock for the SEC to decide whether to clear the ETF for trading.
Grayscale faces competition from other proposed index funds, including those from asset managers Hashdex and Franklin Templeton, but GDLC is unique in including altcoins such as SOL, AVAX and XRP.
The Hashdex and Franklin Templeton funds aim to initially hold only BTC and ETH.
GLDC’s performance. Source: Grayscale
Industry analysts say crypto index ETFs are the next big focus for issuers after ETFs holding BTC and ETH listed in January and July, respectively.
“The next logical step is index ETFs because indices are efficient for investors — just like how people buy the S&P 500 in an ETF. This will be the same in crypto,” Katalin Tischhauser, head of investment research at crypto bank Sygnum, told Cointelegraph in August.
Asset managers and exchanges are filing to register a flurry of proposed altcoin ETFs — including various funds holding SOL, XRP and Litecoin (LTC) — in what analysts are dubbing a “call option” on the outcome of the US presidential election.
“Grayscale and NYSE Arca have taken a thoughtful approach toward developing a proposed ruleset to permit the listing and trading of shares of multi-crypto asset ETPs within the SEC’s existing standard,” David LaValle, Grayscale’s global head of ETFs, said in a statement.
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