The world’s largest digital assets manager Grayscale Investments continues to take steps in order to expand its footprint in the market. Also, the latest report shows that Grayscale is venturing into the crypto indices business in partnership with the London-based indices provider FTSE Russell, a London Stock Exchange subsidiary.
Grayscale and FTSE Russell have joined hands to provide a product dubbed Crypto Sector Index Series to market enthusiasts. This product will include several indices tracking the prices of a bucket of different digital assets based on their use cases.
The designated groups will encompass various categories of cryptocurrencies, including those designed for use as a medium of exchange or store of value (such as Bitcoin and Litecoin), smart contract platforms (like Ether, Solana, and Polygon), tokens representing financial services (such as Uniswap, Compound, and Curve), digital assets tied to art, gaming, and media (including NFT projects), and projects oriented towards real-world applications (like Chainlink, Filecoin, and others), as indicated in the announcement.
To ensure equitable evaluation of assets within each category, the indices will employ the square root of the market capitalization of each cryptocurrency. This approach mitigates the dominance of highly capitalized assets like Bitcoin, providing investors with a more diversified exposure across the entire group.
Grayscale and DCG Lawsuits
In the previous week, New York Attorney General Letitia James filed a complaint against DCG, the parent company of Grayscale, as well as its subsidiary Genesis, the cryptocurrency exchange Gemini, and individuals including former Genesis CEO Michael Moro and DCG CEO Barry Silbert.
The complaint alleged that both Gemini and Genesis had provided misleading information to the public regarding their collaborative product, Earn. In this initiative, Gemini extended users’ funds to Genesis, which, in turn, lent these funds to various counterparties, including the embattled crypto trading entities Three Arrows Capital and Alameda Research. It’s noteworthy that both of these firms had previously faced a lawsuit by the SEC concerning the Earn product back in January, and they have been entangled in a legal dispute regarding the responsibility for the user funds that were ultimately lost.
On the other hand, Grayscale has made good progress in its legal battle with the US SEC. Earlier this week on Monday, the US court asked the SEC to review Grayscale’s application of converting its GBTC product to a spot Bitcoin ETF. Furthermore, Grayscale also submitted its application for spot Ethereum ETF to the SEC.
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