Grayscale Investments, the leading cryptocurrency asset manager, has made changes to its Digital Large Cap (DLC) Fund by selling off its Cardano (ADA) holdings and using the proceeds to purchase XRP and other assets in the fund.
Grayscale officially announced this decision through a press release that provided details on the fund’s quarterly rebalancing. The rebalancing affected several of the company’s investment products, including the Digital Large Cap Fund, Smart Contract Platform Ex-Ethereum Fund, and DeFi Fund.
As a result of this rebalancing, XRP now accounts for 1.73% of Grayscale’s DLC Fund. It is worth noting that the DLC Fund has assets under management totaling $570,206,758.29, as reported on the company’s official website. This means that Grayscale holds approximately 16.7 million XRP tokens.
Unsurprisingly, Bitcoin remains the largest holding in Grayscale’s DLC Fund, representing 70.96% of the portfolio. Ethereum (ETH) comes next with 21.85%, followed by Solana (SOL) at 4.52%. Avalanche (AVAX) has the smallest allocation at 0.95%. Additionally, there have been no new token additions to the DLC Fund as of the end of Q1 2024.
XRP’s re-entry into the GDLC Fund occurred in the last quarter of 2023, following the resolution of the legal dispute between XRP and the SEC. Previously, Grayscale had held XRP in its DLC Fund until the SEC challenged its classification as a security, which prompted Grayscale to distance itself from XRP.
With XRP now back in the fund, there is speculation within the crypto community about its potential impact on XRP’s market value, especially considering Grayscale’s significant holdings of over 16 million XRP.
It is worth noting that the primary objective of the Grayscale Digital Large Cap Fund is to provide investors with exposure to some of the most prominent cryptocurrencies.
The return of XRP to the GDLC Fund has sparked speculation about Grayscale’s potential launch of an XRP spot exchange-traded fund (ETF). This speculation is fueled by Grayscale’s recent launch of Bitcoin spot ETFs, with an Ethereum spot ETF currently in development. Market participants see XRP as the next logical choice for an ETF due to its clear regulatory status.
Disclaimer: This article is for informational purposes only and should not be considered financial advice. The opinions expressed in this article are solely those of the author and do not reflect the views of The Crypto Basic. Readers are advised to conduct their own research before making any investment decisions. The Crypto Basic assumes no responsibility for any financial losses incurred.