Grayscale Files S-3 to Launch Spot Cryptocurrency ETF with Top Altcoins

YEREVAN (CoinChapter.com) — Grayscale submitted an S-3 filing to the US Securities and Exchange Commission (SEC) on April 1. The filing seeks to convert its Digital Large Cap Fund into a spot cryptocurrency ETF, allowing it to be publicly traded.

The Digital Large Cap Fund has operated since 2018. It is not listed on any exchange and is currently available only to accredited investors, according to the Grayscale website.

The fund includes a crypto index ETF structure that holds several major digital assets. These are Bitcoin (BTC), Ether (ETH), Solana (SOL), XRP, and Cardano (ADA).

Digital Large Cap Fund Holds Over $600 Million

As of April 1, the Digital Large Cap Fund held over $600 million in assets under management (AUM). The current crypto prices reflected in the fund include BTC at $84,308, ETH at $1,861, SOL at $123.97, XRP at $2.08, and ADA at $0.668.

The fund uses a market cap-weighted index. This means it distributes value across different coins based on their market sizes. It provides access to a basket of the largest digital currencies.

To make the Digital Large Cap Fund a spot cryptocurrency ETF, Grayscale needs approval from the SEC under the S-3 regulation.

NYSE Arca Supports Grayscale’s ETF Proposal

On October 29, NYSE Arca submitted a proposal to list the Digital Large Cap Fund on its exchange. This move was part of a broader effort to bring more crypto index ETFs to public markets.

The new S-3 filing builds on the earlier proposal by NYSE Arca. It reflects Grayscale’s attempt to transition its crypto index product into an ETF that trades on traditional exchanges.

If approved, the spot cryptocurrency ETF would become available to regular investors, not just institutions or high-net-worth individuals.

SEC Reviewed Several Crypto Index ETF Filings

In December, the SEC approved several crypto index ETFs. These funds, from firms like Fidelity and Hashdex, only hold Bitcoin and Ether. They started trading in February but attracted limited inflows.

By February, the SEC had acknowledged over a dozen new ETF filings. These include proposals for altcoins like XRP and SOL, and features like staking. Some filings also suggest adding options to current ETFs.

The trend shows that asset managers are focusing more on crypto index ETFs. These products allow investors to access multiple cryptocurrencies in a single investment.

Grayscale Expands ETF Efforts with Altcoin Exposure

The Digital Large Cap Fund from Grayscale includes five cryptocurrencies. These are Bitcoin, Ether, Solana, XRP, and Cardano. The fund gives diversified exposure to leading crypto assets.

Above all, the move toward a spot cryptocurrency ETF aligns with broader interest in regulated crypto investment tools. Several firms are taking steps to launch crypto index ETFs as part of their market strategy.

The S-3 filing is a regulatory requirement for converting a private fund into a public ETF. The SEC will review the application and determine whether the fund can begin trading on US markets.