Grayscale Investments, a leading digital asset investor firm, is an indicator of institutional demand for bitcoin. Grayscale Bitcoin Trust has $39.7 Billion in assets under management (AUM). The parent company has been endorsed by some prominent Silicon Valley names.
Digital Currency Group, Grayscale’s parent company, has attractedsome large investors, including a division from tech giant Google. They are betting on the continued adoption of Bitcoin and other major cryptocurrency. SoftBank led a secondary round of $700 million into DCG, with CapitalG’s participation, which is also the growth fund for Google parent company Alphabet. Google Capital G, for its part, has $3 billion in AUM.
This massive round values DCG around $10 billion. It is the first time Grayscale has raised outside capital. DCG had previously raised $25 million in total funding prior to this round.
According to Barry Silbert , DCG CEO, the firm does not appear to be aiming to go public. DCG expects to bring in more than $1B in revenue by 2021.
Google’s CapitalG is among the backers. This comes amid a bull cycle for bitcoin, in which the main cryptocurrency has just reached a new all-time high. Market leaders believe that bitcoin still has a lot of runway to gain before the year ends.
Bitcoin currently holds 44% of the market, while Ethereum is at just over 19%. Meme coins have traded more independently of bitcoin in recent months, but institutions tend to prefer bitcoin due to its track record and accepted regulatory status (as evidenced by the approval of a BTC Futures ETF).
Grayscale Pursues Bitcoin ETF
Grayscale is now aiming to convert its bitcoin trust into a spot-market ETF, after regulators have granted bitcoin futures ETF trading permission. Grayscale’s global head for ETFs, David LaValle quoted Bloomberg, stated that they are confident that the SEC would approve their bitcoin ETF application before July 2022.
The bitcoin price reached a new all-time high of $67,000 in October when the ProShares Bitcoin Strategy ETF was launched ( BITO). Although it has since fallen from this level, it remains above the $60,000 psychologically sensitive threshold.
The Bitcoin Fear and Greed Index has 74. GreedCurrent price: $61,950 pic.twitter.com/Qbr9mQBeoS
– Bitcoin Fear and Greed Index November 1, 2021
With a reading of 74, the bitcoin Fear & Greed Index flashes ‘greed’ as investors anticipate widespread adoption to increase prices.