On March 29, the company announced the Grayscale Dynamic Income Fund (GDIF) citing it as its first actively managed investment product.
Grayscale added that the new fund aims to optimize income in the form of ownership rewards tied to cryptocurrency assets that prove stake ownership.
It's the latest effort from the world's largest crypto asset manager to retain clients and capital following a massive exodus from its flagship product (GBTC) and into a spot Bitcoin ETF.
Grayscale goes to staking
“Using qualitative and quantitative factors, we invest capital across a pool of proof-of-stake tokens.”
The fund will convert token rewards into cash on a weekly basis, distribute dividends to investors quarterly, and rebalance tokens to optimize income.
The fund's revealed holdings were very mysterious. It will consist of 24% of the Osmosis token of the Cosmos decentralized exchange, OSMO. An additional 20% will be held in Solana (SOL), and 14% in Polkadot (DOT).
The remaining 43% was vaguely labeled “other,” and there was no mention of the world’s largest proof-of-stake token, Ethereum. The portfolio manager for GDIF is Matt Maximo, who has been with Grayscale Investments since 2021.
In addition, the new fund is only available to high-net-worth individuals with assets under management of more than $1.1 million or a net worth of more than $2.2 million, and has a 10% performance fee.
Grayscale's industry-leading Bitcoin Trust (GBTC) has been hemorrhaging capital since it converted to an exchange-traded fund in January. The fund, which previously held 620,000 BTC, has shrunk by 46%, after losing 284,846 BTC worth $20 billion over the past 11 weeks.
This week alone, GBTC lost $967 million worth of Bitcoin. However, rival products from BlackRock and Fidelity have captured more, reversing the trend of outflows to Bitcoin ETFs.
Staking predictions
The global staking market is worth about $355 billion, according to Scking Rewards.
It lists ETH as the leading mortgage asset, with a value of $110 billion. Solana is the second largest company with a share of $72 billion, followed by SUI, Aptos, and Cardano, each worth about $15 billion.
It reported that the average reward rate is 6%, although many of the higher-value coins, such as ETH, SUI, ADA, and BNB, are lower than that.
