Grayscale Investments, the world’s largest digital asset management company, has been showing exponential increases in investment in its crypto currency products. Total assets under management grew by $1 billion in less than two weeks in July, as a Twitter update showed. In addition, according to the latest documentation, the number of shares issued in Grayscale between the first and second quarters of 2020 increased by 90 percent.
Considering that in its Q2 update, the company revealed that it had raised about $900 million for the entire quarter, interest in Grayscale’s products appears to be growing at an exponential rate. At the time, the company had more than $5.2 billion in cryptosystems combined, with Bitcoin leading with $4.4 billion. In total, the company received $1.4 billion in the first half of 2020.
Investment levels in Grayscale’s funds are also exceeding those at the end of 2017, even though the price of Bitcoin is not as high. Overall, this is considered one of the best indicators of institutional interest in digital assets, given that no commercial funds have been approved in the Bitcoin market so far.
The demand is not only for Bitcoin
While Bitcoin is by far the most popular product in Grayscale’s family of investment products, other assets have also grown significantly, with Ether (ETH) being the second largest winner. Grayscale has also recently filed a registration statement on the U.S. Securities and Exchange Commission’s (SEC) Form 10 for the Grayscale Ethereum Trust, designating them as an SEC reporting company if validated.
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This shows a growing institutional demand for Ether, which is also manifested in the growing volume of derivatives. This interest is likely to be driven by increasing activity in the decentralised finance sector (DeFi) and stablecoins.
Investors in Grayscale have also shown interest in diversifying into various cryptosystems by investing in the company’s Grayscale Digital Large Cap Fund. The fund is Grayscale’s fourth public offering, provides exposure to multiple crypto assets and is available for over-the-counter stock trading. Rayhaneh Sharif-Askary, Grayscale’s head of investor relations, told Cointelegraph:
„In the first half of 2020, Grayscale saw $1.4 billion of capital invested in the private placements of its family of products. Demand for altcoins is increasing. Demand for ex-Grayscale Bitcoin Rejoin Trust products has risen by 35% Q-over-Q and 81% of institutional investors returning in 2Q20 have now allocated to multiple products (a 71% increase over Q12M)“.
Bitcoin Cash and Litecoin shares are Grayscale’s fifth and sixth public offerings and have recently received permission from the U.S. Financial Industry Regulatory Authority to make both funds available for public OTC trading.