The U.S. Securities and Exchange Commission (SEC) has approved the conversion of Grayscale Digital Large Cap Fund into a spot exchange-traded fund (ETF), attracting attention to cryptocurrencies.
SEC Approval for Fund Conversion
The SEC approved the conversion of Grayscale's Digital Large Cap Fund into a spot ETF on an accelerated basis. The regulator noted that 'the proposed rule change (SR-NYSEARCA-2024-87), as modified, is hereby approved on an accelerated basis.'
Structure of Grayscale's Fund
Currently, the GDLC trades over the counter for accredited investors and is composed of approximately 80% Bitcoin and 11% Ethereum. Other cryptocurrencies, such as Solana, Cardano, and XRP, make up single-digit percentages of the fund.
Future of Crypto ETFs
According to ETF Store President Nate Geraci, the approval of Grayscale's fund could precede approvals for individual spot ETFs on assets such as XRP and SOL. Wall Street analysts also estimate the likelihood of approvals for SOL, XRP, and Litecoin spot ETFs by the end of the year at 95%.
The SEC's approval of Grayscale's conversion to a spot ETF highlights the growing interest in cryptocurrency assets and could lead to further changes in the regulation of crypto funds.
