Bitcoin ETF Giant Grayscale Introduces a Crypto Staking Fund
The Grayscale Dynamic Income Fund initially includes APT, TIA, CBETH, ATOM, NEAR, OSMO, DOT, SEI and SOL.
Updated Mar 9, 2024, 2:15 a.m. Published Mar 5, 2024, 4:55 p.m.
Grayscale, the investment firm behind the biggest spot bitcoin ETF, has introduced a new fund that stakes cryptocurrencies to earn income.
The Grayscale Dynamic Income Fund (GDIF), the company said Tuesday, initially will own assets for nine blockchains: Aptos (APT), Celestia (TIA), Coinbase Staked Ethereum (CBETH), Cosmos (ATOM), Near (NEAR), Osmosis (OSMO), Polkadot (DOT), SEI Network (SEI), and Solana (SOL). It aims to distribute rewards in U.S. dollars on a quarterly basis.
"As our first actively managed Fund, GDIF is an important expansion of our product suite and enables investors to participate in multi-asset staking through the convenience and familiarity of a singular investment vehicle," Grayscale CEO Michael Sonnenshein said in a statement.
Staking plays a key role in how some blockchains. Whereas the Bitcoin network relies on proof-of-work – in which miners crunch complex numerical puzzles to create new bitcoin (BTC) – proof-of-stake networks like Ethereum instead allow owners of their token to pledge their assets to run the network. Doing so is called staking, and it generates income for the staker.
It's an auspicious occasion to bring crypto products to market with bitcoin hitting an all-time high above $69,000 on Tuesday. Speaking to the crypto rally, Zach Pandl, head of research at Grayscale, said valuations for Ethereum's ether (ETH) and most other tokens remain below their highs from the previous crypto cycle.
"If the macro markets backdrop remains favorable, we could see further increases in token valuations – but macro factors could also be a headwind," Pandl said in an email.
Ian Allison
Ian Allison is a senior reporter at CoinDesk, focused on institutional and enterprise adoption of cryptocurrency and blockchain technology. Prior to that, he covered fintech for the International Business Times in London and Newsweek online. He won the State Street Data and Innovation journalist of the year award in 2017, and was runner up the following year. He also earned CoinDesk an honourable mention in the 2020 SABEW Best in Business awards. His November 2022 FTX scoop, which brought down the exchange and its boss Sam Bankman-Fried, won a Polk award, Loeb award and New York Press Club award. Ian graduated from the University of Edinburgh. He holds ETH.
