XRP News Today: Grayscale's Digital Large Cap Fund Approved for Spot ETF Conversion by SEC

The U.S. Securities and Exchange Commission (SEC) has given the green light to Grayscale's plan to transform its Digital Large Cap Fund into a spot exchange-traded fund (ETF). This decision is a pivotal moment in the evolution of regulated access to digital assets, as the fund encompasses major cryptocurrencies such as Bitcoin (BTC), Ethereum (ETH), XRP (XRP), Solana (SOL), and Cardano (ADA). Currently, the Digital Large Cap Fund is available only in the private market. The conversion to an ETF would enable retail investors to trade a diversified portfolio of digital assets on major stock exchanges, potentially attracting a wider range of participants to the market.

This approval follows the SEC's earlier endorsement of Grayscale's Bitcoin futures ETF, which marked the regulator's first step into allowing publicly traded crypto-focused products. Furthermore, in January 2024, the SEC permitted Grayscale to convert its Bitcoin Trust (GBTC) into a spot Bitcoin ETF following a legal victory. The latest application to convert the Digital Large Cap Fund into an ETF builds on this momentum, highlighting the growing potential for broader adoption of spot-based digital asset ETFs in the U.S.

In addition to the Digital Large Cap Fund conversion, Grayscale has proposed a new ETF tied to Cardano (ADA). This “Grayscale Cardano Trust (GADA)” is a completely new product offering, unlike the conversions of existing trusts. The SEC is also reviewing Grayscale’s proposed spot ETFs for Avalanche (AVAX) and Cardano (ADA), with decisions pending. The increasing number of such proposals indicates the industry's persistent efforts to gain broader regulatory approval.

Grayscale’s latest initiative not only underscores its dedication to developing institutional-grade crypto products but also paves the way for more accessible digital asset investment vehicles. This diversification strategy is particularly appealing as it may help mitigate some of the volatility associated with single-asset crypto investments, offering a more balanced approach to digital asset exposure. As the SEC continues to evaluate applications for spot digital asset ETFs, the industry's push for broader regulatory approval is likely to continue, potentially leading to a more inclusive and diversified digital asset market.