I wrote about this some time ago that we would most likely not see a major push for another ETF in the crypto space. Being that Bitcoin is the store of value and Ethereum was the blockchain that these major firms where building on it didn't seem to make much sense that any other ETFs for other crypto tokens would be supported at any time soon.
But that might be changing and it's changing with....
Grayscale
Grayscale is one of the large caps that play a unique game compared to blackrock, fidelity etc. Grayscale primarily works in markets that these don't and as of late they have been exploding in terms of new trusts they have been offering.
You can get the full run down on their site here Grayscale Crypto Products. You'll see tokens like Avalanche, Near, MakerDAO, Horizen and more!
Also It's important to note two things about Grayscale. The first being that they now have a new CEO which has a rather impressive. The second being that these trusts are relatively new and growing at a rather rapid pace.
These trusts were once the go to only option for a lot of investors as the SEC kept rejecting the ETF approvals. What happened next was Grayscale suing the SEC and winning which forced their hand to approval of these ETFs.
ETF vs Trust
This seems like the perfect segway into understanding what a ETF is vs a Trust.
A ETF issues it's own shares that are created and then destroyed as buying and selling happens of the token in real time. This allows them to closely track assets such as crypto to keep them pegged near the same values so as trading happens rapidly you don't see wild swings or a slow reaction by a stock for example before it gets cleared.
A Trust also issues it's own shares however unlike ETFs the shares are created and then destroyed at random times and not live. This leads to possible wild swings in prices until the trust can be bought or sold.
With trusts this normally happens on a quarterly level in which Grayscale will adjust the balances that make up the trusts as some are large cap trusts. Kind of like you have the S&P 500 which has the top 500 stocks these trusts can also hold more than one token in them in some cases which gets shifted around on a quarterly basis.
The Demand
Now before all of this it was pretty hard to tell if there would be much if any demand for these other "alt coins" on these types of markets. However with the trusts from Grayscale we are seeing there's actully a rather impressive amount of investment happening already.
These trusts nearly all of them besides Ethereum classic are trading a a massive premium at the moment. There's also been what seems to be a heavier push into AI tokens and also non Ethereum tokens which do the same thing.
If we pull all of this together we can start to see there is some rather big demand behind these other tokens and we could in fact maybe soon see further ETFs for the tokens trusts you see listed on Grayscale.
For myself I'll be watching Grayscale now for new tokens being added into their trusts as that could be a sign of the next ETF crazy on that token.
What are you thoughts? What's the next ETF token going to be?
Posted Using InLeo Alpha
