Grayscale Investments launches exclusive staking income fund for wealthy clients

Grayscale Investments Unveils New Staking Income Fund for High-Net-Worth ClientsGrayscale Investments Unveils New Staking Income Fund for High-Net-Worth Clients

In this post:

  • Grayscale Investments introduces the Grayscale Dynamic Income Fund (GDIC), aimed at sophisticated investors with over $1.1 million in AUM or a net worth exceeding $2.2 million.
  • The fund focuses on generating income through staking cryptocurrency tokens, planning to convert staking rewards to USD for quarterly distributions.
  • Grayscale faces criticism for high fees on its Bitcoin ETF and regulatory hurdles with the SEC for its Ethereum Futures ETF.

Grayscale Investments has launched the Grayscale Dynamic Income Fund (GDIC), a unique investment vehicle designed to provide sophisticated investors with access to the income generated by staking cryptocurrency tokens. The fund targets those individuals who have over $1.1 million in assets under management (AUM) or a net worth of more than $2.2 million, demonstrating its orientation toward the wealthier class.

GDIC intends to convert staking rewards into US dollars once a week to distribute earnings to investors quarterly. Grayscale has focused on the thoroughness of its process for choosing Proof of Stake (PoS) tokens for inclusion in the fund’s portfolio, recognizing the diverse staking and unstaking timelines and requirements for each token. Nevertheless, the fund tends to maximize the staking income, but capital growth is the underlying objective.

Portfolio composition and regulatory issues

Grayscale has disclosed that its fund’s portfolio will initially comprise three PoS tokens: OSMO, SOL, and DOT, with 24%, 20%, and 14% allocations, in that order. The remaining 43% of the portfolio will be comprised of different tokens. This strategic choice was made considering the actual staking reward rates, where OSMO is at 11.09%, SOL is at 7.42%, and DOT is at 11.9%, according to Staking Rewards.

Coincidingly, Grayscale issued a spot Bitcoin exchange-traded fund (ETF) on Jan 11 and is facing criticism over its high fees, which have caused an outflow of over $14 billion. The fund management fee of 1.5% per annum is substantially higher than the average fee of 0.30% charged by other spot Bitcoin ETFs. Furthermore, Grayscale continues to struggle with regulatory issues in obtaining the US Securities and Exchange Commission (SEC) approval for its Ethereum Futures ETF.

Disclaimer. The information provided is not trading advice. Cryptopolitan.com holds no liability for any investments made based on the information provided on this page. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decisions.

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