Should We Expect More Crypto ETFs

in #hive-1679223 months ago

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

Sort:  

Very interesting. I had heard that XRP would probably be the next one if we go that route. I'm not sure how they can accomplish that if the lawsuit is still going on. I thought it was close to being done though.

PIZZA!

$PIZZA slices delivered:
@libertycrypto27(1/15) tipped @bitcoinflood

This post has been manually curated by @bhattg from Indiaunited community. Join us on our Discord Server.

Do you know that you can earn a passive income by delegating your Leo power to @india-leo account? We share 100 % of the curation rewards with the delegators.

100% of the rewards from this comment goes to the curator for their manual curation efforts. Please encourage the curator @bhattg by upvoting this comment and support the community by voting the posts made by @indiaunited.

@libertycrypto27, the HiQ Smart Bot has recognized your request (1/2) and will start the voting trail.

In addition, @bitcoinflood gets !PIZZA from @hiq.redaktion.

For further questions, check out https://hiq-hive.com or join our Discord. And don't forget to vote HiQs fucking Witness! 😻