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Grayscale Files to List Ethereum Classic Trust on Publicly-Quoted OTC Market

Last Updated May 5, 2023 9:27 AM
Josiah Wilmoth
Last Updated May 5, 2023 9:27 AM

Grayscale Investments has filed to list its Ethereum Classic Trust on a publicly-quoted over-the-counter (OTC) market, a move that will provide investors to buy this fund through retail brokerage accounts.

Grayscale managing director Michael Sonnenshein made this announcement during an interview with CNBC , revealing that Canaccord Genuity — the trust’s broker-dealer — had filed an application to have the Ethereum Classic Trust quoted on the OTCQX market later this year.

Once the trust is publicly-quoted, retail investors will be able to purchase shares through brokerage platforms and hold them in tax-advantaged accounts like IRAs. At present, shares are only offered through private placement and are restricted to accredited investors who purchase at least $10,000 worth of shares.

The Ethereum Classic Trust will be Grayscale’s second product to be quoted on an OTC market. The firm’s most well-known product, the Bitcoin Investment Trust (OTCQX: GBTC) has been publicly-quoted since 2015 and is a favorite among retail investors.

Shares, however, are not currently redeemable for the underlying assets, so its price often diverges from its net asset value (NAV) based on supply and demand. Demand for GBTC is so high that its shares regularly trade at a 60 percent or greater premium over its NAV. On Monday, GBTC shares closed at $15.16, approximately 67 percent over the fund’s $9.07 NAV, according to data from pseudonymous trader BambouClub .

As CCN.com reported, Grayscale has launched a slew of new funds in 2018, doubling the size of its product line. Most notably, the firm opened a fund that holds the five largest cryptocurrencies by market cap, providing investors with exposure to approximately 70 percent of the aggregate value in the market.

Earlier this month, Grayscale also launched individual trusts for Ethereum, Ripple, Litecoin, and Bitcoin Cash, adding to a lineup that already included the Bitcoin, Ethereum Classic, and Zcash Investment Trusts.

Coinbase, best known for its cryptocurrency exchange and brokerage platform, also announced this month that it will launch an investment product that tracks the market cap-weighted performance of the cryptocurrencies available on Coinbase’s platform. Unlike with Grayscale’s products, investors can purchase Coinbase Index Fund shares with Bitcoin and several other cryptocurrencies.

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