Grayscale Files S-3 to Launch Digital Large-Cap ETF

The fund holds a diversified portfolio of multiple cryptocurrencies, including altcoins such as Ethereum (ETH), Solana (SOL), Cardano (ADA) and Ripple (XRP).

U.S. regulatory documents show that asset management company Grayscale has submitted an application to launch an exchange-traded fund (ETF) that holds a diversified portfolio of spot cryptocurrencies.

On April 1, Grayscale submitted an S-3 regulatory filing to the U.S. Securities and Exchange Commission (SEC), which is a necessary step to convert an unlisted fund into an ETF.

The Grayscale Digital Large Cap Fund was established in 2018 but has not yet been listed on an exchange. The fund's cryptocurrency index portfolio includes Bitcoin (BTC), Ethereum (ETH), Solana (SOL), Ripple (XRP) and Cardano (ADA).

According to Grayscale's official website, as of April 1, the fund's total assets under management (AUM) exceeded US$600 million and is only open to accredited investors (i.e. high-net-worth entities or individuals).

The filing comes after the U.S. stock exchange NYSE Arca requested permission to list Grayscale index funds on Oct. 29, 2024.

Grayscale Digital Large Cap Fund holds a diversified portfolio of digital assets.

Index ETFs in the spotlight

The filing highlights the accelerated pace of ETF issuers' plans to launch crypto products as federal regulators under U.S. President Trump have become more relaxed about digital assets.

In December last year, the SEC approved the first batch of hybrid crypto index ETFs. However, these funds sponsored by Hashdex and Fidelity only hold Bitcoin and Ethereum and have seen relatively limited inflows since their launch in February this year.

According to records, the SEC has confirmed more than 12 exchange applications related to cryptocurrency ETFs in February this year. These applications involve pledge and options issues for existing funds, as well as new fund proposals for altcoins such as Solana and Ripple.

According to industry analysts, crypto index ETFs have become a major focus for Wall Street issuers after the launch of BTC and ETH-related ETFs last year. Katalin Tischhauser, head of investment research at crypto bank Sygnum, told Cointelegraph in an interview last August: “Index ETFs are the logical next step because indexes are efficient for investors — just like people buy S&P 500 index ETFs, the same will be true for crypto.”