Despite regulatory challenges, Grayscale is introducing three new ETFs.
Grayscale Investments is seeking to bolster its exchange-traded funds (ETFs) lineup with three new crypto-focused funds while also creating a subsidiary to manage its expanding portfolio.
On May 9th, Grayscale announced the formation of a new branch within its organization, the Grayscale Funds Trust. The move will enable the company to internally manage many of its publicly traded financial products.
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Alongside the launch of the new trust, Grayscale has submitted a registration statement to the United States Securities and Exchange Commission (SEC) for approval of three innovative crypto-focused ETFs.
The trio of proposed funds includes an Ethereum Futures ETF, a Global Bitcoin Composite ETF, and a Privacy ETF.
The Global Bitcoin Composite ETF is designed to invest in exchange-traded products connected to or backed by Bitcoin (BTC), such as Bitcoin mining companies. Likewise, the Ethereum Futures ETF aims to provide indirect exposure to the potential future value of Ether (ETH) by investing in shares that track ETH's price.
Meanwhile, the Grayscale Privacy ETF plans to invest in firms working on blockchain-based privacy technology.
Until the SEC approves the registration statement from the Grayscale Funds Trust, the three ETFs will remain off-limits to public investors.
This development follows Grayscale's ongoing legal dispute with the SEC regarding the conversion of its $17 billion Grayscale Bitcoin Trust (GBTC) into a spot Bitcoin ETF product.
Grayscale filed a lawsuit against the regulator, accusing the SEC of discriminatory treatment between crypto spot traded exchange-traded products and futures products.
Grayscale's argument against the SEC is bolstered by the claim that "there is a 99.9% correlation between prices in the BTC futures market and the spot Bitcoin market."
Although the SEC has approved several Bitcoin Futures ETFs, which allow investors exposure to BTC's potential future value, the regulator has consistently rejected applications for spot Bitcoin investment products.
Grayscale's ambitious move to expand its crypto ETF offerings and create a new trust demonstrates the organization's commitment to the growing digital asset market despite regulatory hurdles.
