SEC Greenlights Grayscale’s Diversified Crypto ETF
The U.S. Securities and Exchange Commission gave Grayscale Investments the go-ahead to convert its Digital Large Cap Fund (GDLC) into an exchange-traded fund—one that’s heavy on Bitcoin but also holds Ethereum, XRP, Solana, and Cardano. The filing, made public Tuesday, marks another step in the slow but steady opening of crypto investment options for mainstream traders.
Bloomberg ETF analyst James Seyffart noted on X that the approval wasn’t exactly a surprise. Bitcoin and Ethereum make up roughly 90% of GDLC’s holdings, and the SEC has been warmer to funds dominated by those two. Still, it’s a shift from the agency’s years of resistance.
What’s in the Fund?
Grayscale’s fund tracks the CoinDesk 5 Index, which weights assets by market cap and liquidity. Right now, Bitcoin accounts for over 80% of the portfolio. Ethereum sits at around 11%, with smaller slices going to Solana (2.8%), XRP (4.8%), and Cardano (0.8%).
The timing’s interesting, though. Crypto markets have been sluggish lately. Bitcoin dipped 1.3% in the past day, hovering near $106,000 at press time. Ethereum dropped 2.4% to around $2,400, while Solana took a sharper 6% hit. XRP and Cardano didn’t fare much better, down 1.1% and 4.4%, respectively. Whether that played into the SEC’s thinking is anyone’s guess.
A Faster Approval Than Expected
What’s striking is how quickly this moved compared to past battles. The SEC spent over a decade rejecting spot Bitcoin ETFs before finally relenting earlier this year. This time, Grayscale got its answer a day before the deadline—no last-minute rejection, no drawn-out drama.
GDLC will trade on NYSE Arca, joining Grayscale’s previously converted Bitcoin and Ethereum trusts. Those earlier products, as closed-end funds, sometimes traded at odd premiums or discounts due to structural quirks. The ETF format should iron that out.
Seyffart hinted that this might just be the start. He expects a “wave of new ETFs” by late 2025, with asset managers eyeing funds tied to Dogecoin, Litecoin, and others. But the SEC’s stance seems clear for now: funds anchored by Bitcoin or Ethereum? Fine. Niche altcoin-only ETFs? Don’t hold your breath.
Grayscale’s 2023 lawsuit against the SEC—which it won—likely helped pave the way here. The court criticized the agency’s inconsistent reasoning, and that pressure may have softened its resistance. Whether that momentum holds is another question. For now, though, crypto investors have one more option.
(Decrypt reached out to Grayscale for comment but hasn’t heard back yet.)
