Companies

FINRA approves Grayscale Ethereum Trust for retail

May 23, 2019, 9:23AM EDT

Asset management firm Grayscale has secured approval from FINRA to list eligible shares of its Grayscale Ethereum Trust, making it the first publicly quoted security tied to the second-largest cryptocurrency, the firm said. 

Grayscale manages 10 funds, most of which are only available to accredited investors. Now, the Ethereum Trust, similarly to Grayscale's Bitcoin Trust, will be able to trade freely as other securities in over-the-counter markets. Grayscale's product is not the same as an exchange-traded fund, which promises more liquidity, lower fees, and wider availability.

Still, Grayscale says it will help investors gain exposure to ether without the hassles of "buying, storing, and safekeeping Ethereum."

It will trade under the ticker ETHE in approximately two weeks.

In total, Grayscale manages $1.9 billion, according to a May 22 tweet by the firm. 

As noted by The Block analyst Ryan Todd, Grayscale has seen more institutional investors pour money into its funds. Hedge funds, specifically, significantly increased their investments from less than $1 million in 4Q to close to $24 million in 1Q.

Meanwhile, the percentage mix of total quarterly inflows stemming from accredited investors softened from 7% trailing 12-months to 1% in 1Q, while family offices grew to 10% of total inflows. 

The DCG subsidiary recently launched a mass marketing campaign calling for U.S. investors to ditch gold and to join the digital bitcoin movement. 

Reporting by Frank Chaparro.

Related Reading