Grayscale Investments, one of the most vocal crypto newsmakers of Q2 2020, has shared new statistics of its managerial assets. Here's why the last week was crucial for Grayscale.
Grayscale Bets on XRP, Litecoin (LTC), Bitcoin Cash (BCH)
The Grayscale team periodically updates its statistics on managerial assets, the price per share, and its net value. It continues to grow its AUM aggressively with a focus on some prospective assets.
07/31/20 UPDATE: Net Assets Under Management, Holdings per Share, and Market Price per Share for our Investment Products.— Grayscale (@Grayscale) July 31, 2020
Total AUM: $5.2 billion$BTC $BCH $ETH $ETC $ZEN $LTC $XLM $XRP $ZEC pic.twitter.com/2qDVCNzLAY
Last week, the net volume of Grayscale's managerial assets surpassed its monstrous level of $5 Billion for the first time. Grayscale mostly added to its Bitcoin (BTC) holdings. The flagship cryptocurrency segment surged from $3.7B to $4.4B, increasing by $700M.
The XRP and Bitcoin Cash (BCH) positions have almost doubled in the last days. The volume for XRP Trust has increased from $3.1M to $6.2M, while Bitcoin Cash Trust has increased from $8.6M to $16.8M.
The constant growth of the Litecoin (LTC) trust allocation is another significant asset for the Grayscale portfolio. Hedge fund managers increased their LTC positions from $5.7M to $13.5M. It has been also stressed that the shares for the Bitcoin Cash Trust and Litecoin Trust haven't met the requirements of The Depository Trust Company's eligibility criteria.
Unique Vehicle or Dangerous Bubble?
Grayscale Investments is a one-of-a-kind instrument that provides exposure to the cryptocurrencies markets by eliminating the necessity to buy digital assets directly. Therefore, its clients can benefit from the movements within the crypto markets by trading 'shares' of 'trusts' just like ordinary over-the-counter (OTC) stocks.
Grayscale offers single-asset (Bitcoin, Ethereum, XRP) and integral (Digital Large Cap) trusts. Its most popular product is the Ethereum Trust Share (ETHE), which saw an insane rally between the months of May and June 2020.
However, some prominent analysts have expressed their concerns about the overhyped performance of Grayscale products. Ex-Messari's Qiao Wang highlighted that the terms of service in Grayscale lack a redemption mechanism.
Wang also emphasized the fact that buying the ETHE provides investors with no liquidity or taxation benefits as compared to buying Ethers through usual means.