Grayscale's Funds Rebalanced to Align with DeFi, AI's Institutional Momentum

Grayscale Investments, the world's largest digital asset investment manager, has updated three of its cryptocurrency-focused funds during the third quarter of 2025, introducing new assets while adjusting existing allocations in accordance with index methodologies. The firm's DeFi Fund, Smart Contract Fund (GSC), and Decentralized AI Fund underwent rebalancing to align with evolving market dynamics and sector-specific benchmarksGrayscale Updates Fund Portfolios, Adds Aerodrome Finance and Story Tokens in Q3 Review^[1].

The DeFi Fund (OTCQB: DEFG) removed MakerDAO (MKR) and added Aerodrome Finance (AERO) as part of its quarterly review, reflecting the CoinDesk DeFi Select Index methodology. The updated portfolio now includes Uniswap (UNI) at 32.32%, Aave (AAVE) at 28.07%, Ondo (ONDO) at 19.07%, Lido (LDO) at 7.02%, Curve (CRV) at 6.92%, and AERO at 6.60%Grayscale Investments® Announces Rebalancing of Multi-Asset Funds for Third Quarter 2025^[2]. The shift underscores a strategic pivot toward protocols perceived as more representative of the decentralized finance sector.

The Smart Contract Fund retained its core holdings but adjusted weightings to maintain exposure to major blockchain networks. Solana (SOL) and Ethereum (ETH) remain the top allocations at 30.97% and 30.32%, respectively, followed by Cardano (ADA) at 18.29%, Avalanche (AVAX) at 7.57%, Sui (SUI) at 7.35%, and Hedera (HBAR) at 5.50%Grayscale's Multi-Asset Fund Rebalancing in Q3 2025^[3]. These changes align with the CoinDesk Smart Contract Platform Select Capped Index, which emphasizes balanced exposure among competing networks.

Grayscale's Decentralized AI Fund expanded its portfolio by incorporating Story (IP), a decentralized artificial intelligence infrastructure project. The rebalance redistributed existing assets to accommodate the new addition, resulting in a composition of NEAR Protocol (NEAR) at 25.81%, Bittensor (TAO) at 22.15%, IP at 21.53%, Render (RENDER) at 12.91%, Filecoin (FIL) at 11.39%, and The Graph (GRT) at 6.21%Grayscale Updates Q3 2025 Fund Allocations^[4]. The move signals growing investor interest in AI-driven blockchain protocols.

The firm emphasized that none of the funds generate income and that periodic distributions of underlying assets to cover expenses lead to a gradual reduction in component holdings per shareBREAKING: Grayscale Announces Addition of Two New Altcoins to Portfolios^[5]. All adjustments were executed to reflect index methodologies or fund-specific criteria, with no deviations from established rebalancing protocols. Analysts noted that the updates align with broader trends in the crypto market, where DeFi and AI-related assets are gaining traction as institutional investors seek diversified exposure to emerging technologiesRiding the Tides of Transformation in Grayscale's DeFi and AI Investments^[6].