Grayscale Seeks SEC Approval to Convert Its XRP, SOL, and AVAX Trust to Spot ETF

The largest crypto-based asset manager, Grayscale, wants to convert its multi-crypto fund into an exchange-traded fund (ETF).

Grayscale has applied to the SEC to convert itsDigital Large Cap Fund to a spot ETF. The fund tracks several crypto assets, including Bitcoin, Ethereum, Solana, XRP, and Avalanche.

Grayscale's application joins the list of other companies awaiting the SEC's approval to list crypto ETFs.

Grayscale to Convert Its XRP, SOL, AVAX Fund to ETF

Grayscale filed 19b-4 documents with the US SEC to change its Digital Large Cap Fund (GDLC) into an ETF.

The GDLC fund is an over-the-counter trading multi-crypto product comprising some prominent crypto tokens, including Solana, Avalanche, and XRP.

The fund trades as a security and invests 75.59% in Bitcoin and 17.73% in Ethereum. It also holds smaller proportions of Solana (SOL), XRP, and Avalanche (AVAX).

Converting GDLC to a spot ETF will enable investors to purchase or sell its shares easily.

Grayscale released an accompanying 8-K form alongside its latest filing to notify its investors that the fund complies with the NYSE's proposed rules and listing reforms.

The latest filing follows two previous conversions this year. First, the asset manager applied to convert its Grayscale Bitcoin Trust (GBTC) to a spot Bitcoin ETF.

Though the SEC initially rejected the application, the regulator later approved the document after Grayscale secured a legal win over the SEC.

Again, in July, Grayscale converted its Ethereum Trust into spot ETH ETFs after the SEC approved them.

Following its conversion, Grayscale's Bitcoin ETF, GBTC, has recorded over $20 billion in net outflows, according to Farside Investors.Its Ethereum ETF, ETHE, haspostedmore than $2.98 billion in net outflows.

Several ETF Applications Await The SEC Approval

The list of ETF applications on the SEC's desk keeps growing.Moreover, the potential issuers are varying their taste with different crypto ETFs on the list.

In a new development, Canary Capital filed for a Litecoin ETF with the SEC. According to its S-1 form, the firm categorized Litecoin among the long-existing blockchains with 100% uptime and described LTC as a potential asset that could open the path to enterprise-grade use cases for investors.

Similarly, Canary Capital filed for a spot XRP ETF with the SEC last Tuesday. Canary Capital disclosed that an encouraging progressive crypto regulatory environment spurred ETF applications.

Additionally, on October 2, Bitwise filed an S-1 application for a spot XRP ETF with the SEC.

Reacting to the situation, Nate Geraci, the President of ETF Store, remained optimistic about the emergence of XRP ETF. Geraci noted that a spot XRP ETF will be approved, but it might take a while.

Another XRP ETF filing...

Approval a matter of when, not if IMO.

But that when" will be *much* further out in the future unless there's a change in administration. https://t.co/jMW4NUjhBH

- Nate Geraci (@NateGeraci) October 8, 2024

The outlook suggests increasing crypto adoption by institutional investors on Wall Street. Though the fate of these ETF applications with the SEC is still unknown, the broader crypto community reflects optimism.

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