Grayscale Adjusts Cryptocurrency Portfolios, Adds Avalanche and XRP, Drops MATIC

In a recent move, Grayscale, the asset management firm, has made strategic changes to its cryptocurrency portfolios, impacting three significant funds: the Digital Large Cap Fund (GDLC), the DeFi Fund, and the Smart Contract Platform Ex-Ethereum Fund (GSCPxE Fund).

Digital Large Cap Fund Reallocations

Grayscale's Digital Large Cap Fund now features a rebalanced allocation with Bitcoin leading at 69.15%, followed by Ether at 21.90%, Solana at 3.65%, XRP at 2.54%, Cardano at 1.62%, and AVAX at 1.14%.

Polygon's MATIC Token Removed

As a consequence of this adjustment, Polygon's MATIC token has been entirely removed from the GDLC portfolio.

DeFi Fund Changes

In the DeFi Fund, a notable change involves the removal of the Curve DAO (CRV) token from the portfolio. The updated asset basket includes Uniswap at 41.11%, Lido DAO at 23.90%, MakerDAO at 13.39%, Aave at 12.63%, and Synthetix.

MATIC Still Present in GSCPxE Fund

Interestingly, although MATIC has been removed from one portfolio, it remains part of the GSCPxE Fund, alongside SOL at 44.54%, ADA at 19.77%, AVAX at 13.89%, Polkadot at 9.75%, MATIC at 8.25%, and Cosmos at 3.80%.

Grayscale's Routine Review

Grayscale's fund managers regularly review and adjust fund weightings to optimize performance based on market conditions, risk assessments, and investment objectives. This proactive approach aligns with the company's quarterly review process.

DeFi Fund Faces Challenges

Funds like the DeFi Fund, designed for exposure to decentralized financial markets, have encountered challenges amid the recent crypto market downturn. The fund's shares, at the time of writing, were trading at $22, reflecting a 9.28% decrease in the past 24 hours.

Grayscale's Pursuit of BTC ETF Approval

Additionally, Grayscale is actively seeking regulatory approval for a spot Bitcoin exchange-traded fund (ETF) in the United States. This involves converting the existing Grayscale Bitcoin Trust (GBTC) into a publicly listed BTC ETF. The U.S. Securities and Exchange Commission (SEC) is expected to announce its decision on January 10th.

Despite these strategic moves, funds like the DeFi Fund face challenges amid the current crypto market conditions, with a 9.28% decrease in the past 24 hours. Grayscale's pursuit of a BTC ETF approval signals potential shifts in the crypto investment landscape, pending the SEC's decision.