Grayscale Investments has officially filed to convert its private Digital Large Cap Fund into an exchange-traded fund (ETF), opening up the portfolio to public investors for the first time. The fund currently includes top digital assets such as Bitcoin, Ethereum, XRP, Solana, and Cardano, and is currently only available to accredited investors via private placement.
As of the filing, Bitcoin makes up the largest portion of the fund, comprising 79.4%, followed by Ethereum at 10.69%, XRP at 5.85%, Solana at 2.92%, and Cardano at 1.14%. Cardano was added to the fund in January 2025 after Avalanche was removed due to index rebalancing. Since its inception in 2018, the fund has experienced a remarkable 478.83% increase in market value, according to Grayscale.
The filing, submitted on April 1 through an S-3 form to the U.S. Securities and Exchange Commission (SEC), signals the company’s intention to bring the fund to a wider audience. If approved, the ETF would track approximately 75% of the digital asset market, excluding meme coins and stablecoins. Grayscale has yet to disclose the final management fee, which remains subject to change.
The filing comes amid a growing push for new crypto ETFs, particularly following the approval of Bitcoin spot ETFs in January 2024. These were soon followed by Ethereum ETFs and a hybrid Bitcoin-Ethereum fund. As of now, U.S. Bitcoin ETFs manage $97.27 billion in assets, while Ethereum ETFs hold $8.59 billion, according to CoinGlass. However, Grayscale’s Bitcoin spot ETF has faced significant challenges, with over $15 billion in outflows, marking the largest ETF withdrawal since 2009. This has raised concerns over the fund’s ability to maintain its Bitcoin reserves.
The recent surge in crypto ETF filings has prompted issuers to explore funds tracking alternative digital assets such as Dogecoin, XRP, Solana, and even Donald Trump’s meme coin. Bloomberg ETF analyst Eric Balchunas speculated that the DOGE and TRUMP ETFs could launch as soon as early April, though a Myriad Markets poll suggests the TRUMP ETF will likely not materialize by the end of the month, with 93% of voters predicting otherwise.
Index-based crypto ETFs are also gaining traction as fund managers look to diversify their offerings. The SEC approved the first mixed crypto index ETFs in December 2024, backed by Hashdex and Fidelity, but these ETFs only include Bitcoin and Ethereum. Since their launch in February, these products have experienced modest inflows. Katalin Tischhauser, head of investment research at crypto bank Sygnum, highlighted the efficiency of index ETFs for investors, drawing comparisons to traditional market index funds.
Grayscale’s move to convert its Digital Large Cap Fund into an ETF comes at a time when the regulatory landscape for crypto ETFs has begun to stabilize, though the market remains volatile. While institutional adoption continues to rise, questions over long-term investor demand for digital asset funds persist.
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