Grayscale Investments has today announced that its “Future of Finance” exchange-traded fund (ETF) will list on the London Stock Exchange, Borsa Italiana, and Deutsche Börse Xetra.
ETFs are a popular investment tool that lets investors buy commodities or a basket of shares for a relatively low management fee.
The Grayscale Future of Finance UCITS ETF (GFOF) is thus a way for investors to make a single stock purchase to bet on the performance of a variety of companies heavily committed to the crypto economy.
The fund is based on the Bloomberg Grayscale Future of Finance Index (BGFOF), which tracks the performance of financial services companies “projected to be leaders of the emerging digital economy.”
These include stocks such as Robinhood, PayPal, Block, and Coinbase, and several crypto mining and energy management firms, including Argo Blockchain, Northern Data, and Canaan.
Grayscale Launches ETF of Bitcoin-Exposed Companies Including PayPal, Coinbase
Grayscale Investments, which is best known for offering Bitcoin and other cryptocurrencies in the form of shares, is branching out into the traditional stock market. On Wednesday Grayscale announced the "Future of Finance" ETF, which will hold a basket of shares consisting of 22 public companies that are deeply committed to cryptocurrency. Those include payment and tech firms like PayPal and Block (formerly Square), as well as pure crypto companies like Coinbase and investing firms like Silverga...
GFOF was first launched in February this year on the New York Stock Exchange (NYSE) and currently includes 21 public companies. The fund’s starting price was $25.93; however, as crypto companies’ stocks plunged last week, it closed Friday's trading session at $14.69.
Yet, the Connecticut-based firm is confident in the long-term value the product will deliver
“At Grayscale, we have long believed that the digital economy will be a major driver for the development and growth of the global economy,” said David LaValle, Grayscale’s global head of ETFs.
He added that “European investors now have the opportunity to receive exposure to the companies that are pivotal to the evolution of the global financial system.”
Grayscale’s Bitcoin ETF push
Grayscale is best known for its selection of cryptocurrency investment products, including the Grayscale Bitcoin Trust (GBTC), the firm’s flagship product.
Since February 2021, GBTC has been suffering from a deepening discount, which last week hit historic lows below 30%.
GBTC Discount Hits All-Time Low as SEC Mulls Bitcoin ETF
Shares of the Grayscale Bitcoin Trust (GBTC) hit record lows against its net asset value (NAV), trading at a 30.79% discount, data from YCharts shows. GBTC is a private-placement trust that trades like a stock and allows investors to get exposure to Bitcoin without actually having to buy the asset. The firm takes care of the custody in exchange for an annual management fee of 2%, while buyers acquire shares in the fund. A massive discount to NAV may seem like a bargain, as it allows investors to...
To eliminate the discount, Grayscale is actively pushing to convert its GBTC into a physical Bitcoin ETF but faces strong opposition from the U.S. Security and Exchange Commission (SEC). Citing risks of price manipulation and Bitcoin’s volatility, the agency is yet to approve a Bitcoin ETF backed by the actual asset.
At the same time, the agency has already greenlit four Bitcoin ETFs tied to futures contracts.
As reported by Decrypt, earlier this month, Grayscale held a private meeting with the SEC to persuade the regulator to approve the move, with the deadline for its pending application due on July 6.
