Grayscale introduces crypto investment fund that prioritizes staking rewards

    30 Mar 2024

    Grayscale Investments has announced an investment fund tailored for sophisticated clients eager to expose their portfolios to income generated from staking cryptocurrency tokens.

    According to a recent statement, the Grayscale Dynamic Income Fund (GDIC) is only available to clients holding more than $1.1 million assets under management (AUM), or with a net worth of more than $2.2 million.

    The fund intends to convert staking rewards into US dollars weekly, with distributions planned quarterly for investors. Additionally, Grayscale claims that careful analysis will be conducted to select the Proof of Stake (PoS) tokens included in the fund’s portfolio.

    “Grayscale manages the complexity of staking and unstaking multiple tokens as each token has its own individual timelines and requirements to be staked and unstaked.”

    The main priority of the fund is to maximize staking income from the assets, with capital growth as a secondary focus, according to Grayscale.

    Crypto staking involves locking up crypto tokens to earn interest or rewards, which in turn ensures the secure and efficient operation of the blockchain network.

    Grayscale has named three PoS tokens that will be held in the fund, including Osmosis (OSMO) comprising a 24% portion, Solana (SOL) at 20%, and Polkadot (DOT) at 14%, while 43% is categorized under other tokens.

    OSMO currently offers a staking reward rate of 11.09%, SOL stands at 7.42%, and DOT is at 11.9%, according to data from Staking Rewards.

    However, only Solana ranks among the top ten PoS tokens by market capitalization, as per CoinMarketCap data.

    Meanwhile, Grayscale’s spot Bitcoin exchange-traded fund (ETF), which launched on Jan. 11, has faced scrutiny due to its high fees, resulting in billions of outflows.

    On March 26, Cointelegraph reported that the Grayscale Bitcoin Trust (GBTC) has seen daily outflows since its launch totaling over $14 billion as of March 25.

    Grayscale’s Bitcoin ETF charges a 1.5% per year management fee, five times that of the 0.30% average of the other spot Bitcoin ETFs.

    On the other hand, Grayscale continues to face regulatory hurdles in securing approval from the United States Securities and Exchange Commission (SEC) for its Ethereum Futures exchange-traded fund (ETF).


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