TLDR
SEC approves Grayscale’s Digital Large Cap Fund conversion to an ETF, including BTC, ETH, XRP, and SOL.
Bitcoin dominates Grayscale’s ETF, making up 80% of its holdings, followed by Ethereum at 11%.
Grayscale’s ETF approval could signal momentum for more crypto ETF proposals from the SEC.
SEC’s evolving approach to crypto ETFs shows a friendlier stance under the new administration.
The U.S. Securities and Exchange Commission (SEC) has approved Grayscale’s Digital Large Cap Fund (GDLC) to convert into an exchange-traded fund (ETF). This decision includes major cryptocurrencies such as Bitcoin (BTC), Ethereum (ETH), XRP, and Solana (SOL). The approval is seen as a step toward further developments in the crypto ETF market, potentially paving the way for other cryptocurrency-focused investment products.
SEC Approves Grayscale’s Mixed Crypto Fund Conversion
The SEC’s approval of Grayscale’s application to convert its Digital Large Cap Fund into an ETF is a key move in the crypto investment space. The fund currently trades over the counter (OTC) for accredited investors, but with this approval, it will become more accessible on major exchanges.
Grayscale’s Digital Large Cap Fund is heavily weighted toward Bitcoin, which makes up nearly 80% of the fund’s holdings. Ethereum follows with an 11% share, while Solana, Cardano, and XRP each have smaller allocations of single-digit percentages. This composition will remain when the fund is listed as an ETF.
This approval reflects a broader trend of increasing regulatory acceptance of cryptocurrency-related financial products. The SEC has previously shown caution regarding the approval of crypto ETFs, but this decision suggests the agency is becoming more open to the idea of including crypto in traditional investment vehicles.
Momentum for Other Crypto ETFs
The approval of Grayscale’s fund could signal momentum for other crypto-related ETF proposals. The SEC has shown interest in a variety of crypto assets, including Solana (SOL), Dogecoin (DOGE), and others. In particular, experts believe the approval of Grayscale’s multi-asset ETF could lay the groundwork for the future approval of single-asset ETFs.
Nate Geraci, president of the ETF Store, noted that the approval of the GDLC fund would likely lead to the approval of additional spot ETFs for cryptocurrencies like XRP, Solana, and Cardano. “The SEC could use GDLC as a test run for adding other crypto assets in the ETF wrapper,” Geraci explained on social media.
As the regulatory environment becomes more favorable, more asset managers may push for the approval of ETFs tracking individual cryptocurrencies, especially those that have gained traction in the market.
SEC’s Evolving Approach to Crypto ETFs
The SEC’s decision to approve the GDLC fund on an accelerated basis also suggests that the agency is adjusting its stance on crypto ETFs. This change is in part due to the friendlier regulatory environment following the inauguration of President Donald Trump in January 2025. Under the new administration, there has been a noticeable shift toward a more open approach to cryptocurrency regulation.
This decision is part of a broader trend where the SEC is considering a wider range of crypto ETFs. These include funds that track a mix of established cryptocurrencies like Bitcoin and Ethereum as well as emerging altcoins like Solana and Dogecoin. The SEC’s willingness to approve these funds may reflect an effort to provide more options for investors seeking exposure to digital assets while still ensuring regulatory oversight.
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