Grayscale, a leading asset management firm, has made a major move by filing a request with the Securities and Exchange Commission (SEC) to convert its Digital Large Cap Fund (GDLC) into a spot exchange-traded fund (ETF). Bloomberg’s ETF analyst, James Seyffart, shared the news, noting that XRP is one of the key assets in the fund.
Fund Restructuring Targets NYSE Listing
This filing aims to transform the fund’s structure, allowing Grayscale to trade it as an ETF. If approved, the product will be listed on the New York Stock Exchange (NYSE), making it more accessible to a wider pool of investors. Currently, the GDLC fund, which manages $534 million in assets, trades over-the-counter (OTC) as a closed-end fund. In its current form, it does not trade based on its Net Asset Value (NAV).
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Grayscale’s push to convert the GDLC into an ETF would enable the fund to trade closer to its NAV. This shift would enhance liquidity, transparency, and overall access for investors. Additionally, ETFs operate under stricter regulations compared to closed-end funds, which could attract more institutional interest.
XRP and Other Key Cryptos in Focus
Bitcoin and Ethereum dominate Grayscale’s GDLC fund, making up 76% and 18% of the holdings, respectively.
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However, XRP’s inclusion in the ETF filing adds pressure on the SEC, especially given the ongoing legal battle with Ripple, the company associated with XRP. Other prominent tokens in the fund include Solana and Avalanche.
SEC Faces Growing Pressure on XRP ETFs
Grayscale’s move comes as competition to launch an XRP ETF intensifies. Earlier this month, Bitwise became the first firm to file for an XRP ETF, followed by Canary Capital, a Valkyrie-backed company. As the SEC reviews these applications, it faces increasing pressure to clarify its stance on XRP.
This filing underscores Grayscale’s strategy to broaden its crypto product offerings amidst growing interest in crypto ETFs.