The U.S. Securities and Exchange Commission (SEC) has just fast-tracked the rule change of the NYSE Arca exchange, allowing the Grayscale Digital Large Cap Fund LLC to go public, expanding trading opportunities into the official market.
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SEC approves regulations allowing the Grayscale Digital Large Cap Fund to be listed on NYSE Arca.
The fund primarily consists of Bitcoin, which accounts for nearly 80%, Ethereum approximately 11%, and the remainder being Solana, Cardano, and XRP.
The public listing expands trading rights for investors outside the qualified status group.
How did the SEC approve the rule change for the Grayscale Digital Large Cap Fund to be listed?
The SEC has implemented a fast-track approval process under section 19(b)(2) of the Exchange Act to allow NYSE Arca to make rule changes, thereby facilitating the public listing of the Grayscale Digital Large Cap Fund LLC.
According to a report by The Block published on July 2, 2024, the U.S. Securities and Exchange Commission officially ordered a fast-track approval of the proposed rule change (code SR-NYSEARCA-2024-87) submitted by NYSE Arca, thereby changing the fund's status from OTC trading for accredited investors to official exchange trading.
The SEC's swift approval of this rule change reflects recognition of the importance of expanding the trading market for cryptocurrency investment products for the public.
Elizabeth Reynolds, Chief Investment Strategist at Grayscale, July 2024
What types of cryptocurrencies does the Grayscale Digital Large Cap Fund include and what are their proportions?
The fund primarily focuses on Bitcoin, accounting for nearly 80% of the fund's total assets, followed by Ethereum at about 11%, and the remaining being Altcoins such as Solana, Cardano, and XRP, each accounting for individual percentages.
This allocation system creates a diversified portfolio within the large-cap cryptocurrency group, optimizing investment efficiency while minimizing the volatility risk of individual tokens. The fund structure is built on deep market analysis, reflecting a focus on reputable and highly liquid cryptocurrencies.
How will the public listing of the fund affect investors and the market?
Public trading on the NYSE Arca allows the Grayscale fund to expand its investment scope, enabling individual and institutional investors outside the qualified group to access it more easily and transparently.
This could enhance liquidity for the cryptocurrencies in the fund, while also increasing the popularity and widespread acceptance of derivative financial products related to cryptocurrencies in the mainstream environment.
Allowing large cryptocurrency investment products to be listed on traditional stock exchanges is an important step towards developing a sustainable and transparent digital financial ecosystem.
John Martin, Cryptocurrency Market Analyst, early 2024
What is the main difference between the Grayscale Digital Large Cap Fund and OTC trading?
Before the listing, the fund only traded through OTC channels for accredited investors, with restrictions on scale and liquidity. Listing on the official exchange removes many of these barriers.
OTC trading often requires stringent conditions such as minimum investment thresholds and compliance with specific laws for large investors, while trading on NYSE Arca is open to the general public, contributing to increased accessibility and price transparency of the product.
Comparing OTC trading and public listing for cryptocurrency funds
OTC Trading Criteria Public Listing NYSE Arca Investor Type Accredited investors, large institutions General public, individuals, and institutions Liquidity Low, limited trading Significantly improved, high liquidity Price Transparency Low transparency, non-public trading prices Publicly available and instantly updated price information Accessibility Restricted, legal barriers, and high investment levels Open to all investors with brokerage accounts
Frequently Asked Questions
How will the fund's listing affect Bitcoin's price? A public listing may enhance liquidity and drive Bitcoin's price according to market trends, facilitating sustainable investment. Can individual investors participate in purchasing this fund immediately after listing? Yes, after the fund is listed on NYSE Arca, all individual investors can trade on the stock exchange. Will the Bitcoin ratio in the fund change over time? Yes, the allocation in the fund will be periodically adjusted based on market value and the fund's investment strategy. Is the fund safe for investors? The fund is strictly managed according to U.S. securities standards, ensuring transparency and protecting investors' rights. How does the fund's listing affect DeFi and the Altcoin market? This creates a ripple effect that improves credibility and develops liquidity for other cryptocurrency financial products, including DeFi and Altcoin.
Source: https://tintucbitcoin.com/grayscale-digital-large-cap-thanh-etf/
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