SEC Approves First Multi-Asset Crypto ETP: Grayscale's GLDC

The US Securities and Exchange Commission (SEC) has greenlit the first multi-asset cryptocurrency exchange-traded product (ETP) in the United States, paving the way for Grayscale’s Digital Large Cap Fund (GLDC) to be listed. This fund will provide investors with exposure to a basket of five leading cryptocurrencies: Bitcoin (BTC), Ether (ETH), XRP (XRP), Solana (SOL), and Cardano (ADA). This approval, detailed in a recent SEC filing, signifies a major milestone for the digital asset industry and builds upon the momentum generated by the successful launch of US spot Bitcoin exchange-traded funds (ETFs). A multi-asset crypto ETP offers a streamlined approach for traditional investors seeking diversified exposure to the cryptocurrency market, eliminating the need to navigate individual exchange accounts or directly purchase digital tokens. This development arrives amidst growing anticipation of an 'altcoin season,' a phenomenon observed during bull markets where altcoins (cryptocurrencies other than Bitcoin) experience significant price appreciation, often outperforming Bitcoin. Earlier in August, Coinbase predicted a potential 'full-scale altcoin season' beginning in September, based on analysis of historical market trends. "We think current market conditions now suggest a potential shift towards a full-scale altcoin season as we approach September," wrote David Duong, Global Head of Research at Coinbase Institutional, in a recent market outlook report. This anticipation, coupled with the ease of access provided by the new ETP, could potentially drive further investment into the altcoin market. Grayscale's crypto ETP received approval under the SEC's new generic listing standards, which are designed to expedite the review process for spot crypto ETFs on major exchanges like Nasdaq, NYSE Arca, and Cboe BZX. These standards streamline the approval process by eliminating the need for individual assessments of each application. "Grayscale Digital Large Cap Fund $GDLC was just approved for trading along with the Generic Listing Standards," announced Grayscale CEO Peter Mintzberg in a post on X (formerly Twitter), adding that the team is working to launch the product "expeditiously." This move signals Grayscale's commitment to providing investors with innovative and accessible cryptocurrency investment products. Mintzberg also acknowledged the SEC Crypto Task Force for their efforts in promoting regulatory clarity within the industry. The SEC Crypto Task Force, established earlier this year, aims to develop a comprehensive regulatory framework for crypto assets under the leadership of Commissioner Hester Peirce, a vocal advocate for the crypto industry. The creation of the task force was seen by industry observers as a shift away from the SEC's previously enforcement-focused approach to the crypto industry under former Chair Gary Gensler. During Gensler's tenure, the SEC pursued legal action against several prominent crypto companies, including Ripple Labs, Terraform Labs, Binance, Coinbase, and Kraken. These legal battles have resulted in substantial legal costs for the industry.