Grayscale’s SEC filing could boost interest of institutional investors
As the financial environment around the world changes, the world of cryptocurrencies has become even more inviting to many investors. Many players in the mainstream markets have been dipping their toes in the crypto pool to test the interest of institutional investors. Major crypto asset manager Grayscale Investments has been one such business witnessing great demand, as it raised a whopping $900 million in the second quarter.
Although COIVD-19 played its trick and forced traders to seek out other investment avenues such as crypto, Grayscale products have been able to turn most interest into trades. Understanding the scarcity of assets like Bitcoin, the institutional investors have been long talking about the issues with governmental bodies printing money. This already swayed many institutions to consider Bitcoin and crypto as a valuable asset, but with a growing interest in Grayscale Ethereum Trust, the investors were looking to diversify.
According to Michael Sonnenshein, Managing Director of Grayscale Investments, even though Grayscale Bitcoin Trust was the firm’s flagship products, Q2 saw a lot of interest in the Grayscale Ethereum Trust. Sonnenshein, who appeared on Unchained podcast with Laura Shin, added:
“…really seeing more investment coming in across the board and I believe now of our returning institutional investors, we now see over 80% of them having now invested in more than one Grayscale product, meaning they now each have exposure to more than one digital currency.”
Grayscale’s Ethereum Trust has been booming and in Q2 the average weekly investment into the trust hit $10.4 million, which amounted to record quarterly inflow of $135.2 million. As the service noted great interest, the firm recently moved to file a registration statement on Form 10 with the Securities and Exchange Commission [SEC] on behalf of the Ethereum Trust. If the filing comes into effect, the trust would become the second crypto investment firm, after Grayscale’s Bitcoin Trust, to acquire the status of an SEC reporting company. This was an important move for Grayscale to establish trust in the eyes of the institutions who remained wary of crypto due to a lack of registration with the SEC.
With the filing, the firm may attract more institutional investors and if the price of the digital asset Ether rallied with the upcoming ETH 2.0, the institutions might be ready to participate in the market.