In a historic moment for the crypto space, the U.S. Securities and Exchange Commission (SEC) has given the green light to Grayscale’s Digital Large Cap Fund (GLDC), which will be the first multi-asset crypto exchange-traded product (ETP) in the U.S.
The fund will trade under the ticker, $GDLC, allowing access to five of the largest digital assets by market capitalization: Bitcoin, Ether, XRP, Solana, and Cardano.
This approval, revealed in a filing on Wednesday, represents a significant step for crypto adoption by traditional investors, following the positive reception of the first spot Bitcoin ETFs that paved the way for crypto-based financial products.
ETP Designed to Attract Traditional Investors Seeking Simplicity
Greyscale’s multi-asset ETP is designed to be an easy accessory for conventional investors who may be wary about managing digital wallets and/or buying products on crypto exchanges.
The ETP bundles several leading cryptocurrencies together into a single regulated product, lowering barriers to entry and diversifying risk across each token.
The announcement comes on the heels of speculation around an imminent “altcoin season,’ when altcoins have historically outperformed Bitcoin during bull markets.
Coinbase recently issued a prediction that altcoin season may come as soon as September, based on market patterns, and for that reason, it seems the timing of Greyscale’s announcement adds to the intrigue of having something come together.
SEC Approves Under New Generic Listing Standards
The SEC granted approval to the Grayscale fund according to newly established generic listing standards, a protocol designed to simplify the examination of crypto ETFs and ETPs.
The new generic listing standards will allow exchanges such as Nasdaq, NYSE Arca, and Cboe BZX to forgo an extended, case-by-case analysis, resulting in quicker approval of the product.
Grayscale’s CEO, Peter Mintzberg, hailed the decision in a post on X, stating that his team is working “expeditiously” to launch the product.
Mintzberg also thanked the SEC’s Crypto Task Force for its commitment to establishing regulatory clarity, acknowledging its efforts as “unmatched” in supporting the growth of the digital asset industry.
Regulatory Uncertainty Still Looms Over Multi-Asset Crypto ETFs
Despite this advancement, there is still unease relating to the SEC’s perspective on multi-asset crypto products.
On July 3rd, the SEC halted Grayscale’s effort to convert its Digital Large Cap Fund into an ETF just one day after it was granted a “preliminary” approval, according to UnoCrypto.
Using Rule 431, the SEC changed course over concerns about the fund’s altcoin exposure to thousands of altcoins in one single fund, including XRP and Solana, even when Bitcoin and Ethereum made up over 91% of the fund.
This situation highlights the SEC’s cautious style of regulatory position under its new chairperson, compared to the enforcement approach of former Chair Gary Gensler, who spearheaded lawsuits against Ripple, Terraform Labs, and exchanges like Binance and Coinbase, before resigning.
While granting approval to Grayscale is a signal of progress, the SEC’s abrupt halt in July is a reminder that clarity, for altcoins specifically, is still a work in progress.