Grayscale Launches New Investment Trusts With Exposure To Bitcoin Layer 2 Projects

Grayscale has introduced two new investment trusts, providing accredited investors with access to Bitcoin layer-2 networks like Stacks and NEAR Protocol. Moreover, these new offerings joined Grayscale’s extensive range of crypto-focused trusts. The existing funds include those dedicated to Solana (SOL), Chainlink (LINK), and others.

Grayscale Offers Exposure To Bitcoin Layer 2 Projects

Rayhaneh Sharif-Askary, Grayscale’s Head of Product and Research, emphasized the firm’s commitment to meeting investor demand for diversified crypto asset exposure. “With continued demand for diversified crypto asset exposure, Grayscale remains committed to launching new products that enable investors to access emerging and evolving parts of the crypto ecosystem,” she said, according to a report by Decrypt.

Stacks, a Bitcoin Layer 2 network, adds smart contract functionality to Bitcoin. In addition, it facilitates the development of decentralized finance applications on the platform. Additionally, the network has gained traction recently due to the rising popularity of Bitcoin protocols Ordinals and Runes, particularly following the rollout of its Nakamoto upgrade last month.

In a statement, Kyle Ellicott, Stacks’ Investor Relations Lead, highlighted the growing institutional interest. She stated, “Within the Stacks ecosystem, we’re witnessing a robust increase in demand from institutions, overall. The greater Bitcoin ecosystem is seeing similar demand as that wide gap continues to lessen around unlocking Bitcoin liquidity and making it more usable.”

Introduced in 2020, NEAR Protocol is a high-speed blockchain designed for decentralized cloud computing. Recently, the project announced the establishment of a new research and development lab focused on artificial intelligence (AI).

Grayscale describes its private placements as the initial stage in the life cycle of its products. Moreover, the asset manager’s ultimate goal is to convert them into exchange-traded funds (ETFs).

Currently, the Grayscale Bitcoin Trust (GBTC) is the only product to have achieved ETF status, following its approval among other Spot Bitcoin ETFs in January. Furthermore, the organization is also seeking SEC approval to convert its Ethereum Trust into an ETF.

Amendments To Ethereum ETF Application

On Wednesday, May 22, Grayscale submitted an updated 19b-4 filing for its proposed Spot Ethereum ETF application. Bloomberg Senior ETF Analyst James Seyffart disclosed this update on X, noting that the company initially amended the application on May 21.

The crypto community is closely watching as the United States Securities and Exchange Commission (SEC) is anticipated to approve Spot Ethereum ETF applications today. The Swift change in SEC’s approach suggest that this could be a historic moment with these approvals. Moreover, Grayscale is meticulously avoiding any potential errors in its application.

In the updated filing, Grayscale has removed the “staking” clause from its Spot Ethereum ETF proposals. This demonstrates the company’s careful consideration of the SEC’s guidelines as the agency allegedly plans to leverage the dynamics of ETH and staked ETH.

Furthermore, the focus on the 19b-4 form is crucial, as it is the first step the SEC will approve in the process leading to the actual launch. Additionally, the frequent updates to the filing may reflect ongoing communication between the SEC and the ETF applicants, incorporating feedback from the regulator.

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