- The SEC has given its accelerated approval for Grayscale’s Digital Large Cap Fund to become a spot ETF.
- This marks the first time a multi-asset crypto fund has transitioned from a private fund to a publicly traded exchange-traded fund.
This approval is a big step for the world of cryptocurrency investments. It means more people will now have an easier way to invest in a wide range of major cryptocurrencies through a familiar investment product. It also shows a great shift in how regulators are viewing these digital assets.
A New Era for Crypto Investments
The US Securities and Exchange Commission (SEC) recently gave a fast-tracked approval for Grayscale’s Digital Large Cap Fund (GDLC) to change from a closed-end fund into a publicly traded spot exchange-traded fund (ETF).
Previously, only a select group of professional investors could access GDLC. Now, it will trade on NYSE Arca, opening up crypto investment to a much wider audience.
The GDLC is designed to track the performance of the five largest cryptocurrencies by market value, following the CoinDesk 5 Index. Its current makeup includes a large portion of Bitcoin (80.2%) and Ethereum (11.3%), along with smaller amounts of Solana (2.7%), XRP (4.8%), and Cardano (0.81%).
The ETF structure helps ensure that the fund’s price closely matches the value of its underlying crypto holdings, after accounting for fees.
This important decision follows years of discussion and even a legal battle between Grayscale and the SEC. Grayscale had previously sued the SEC for denying its application to convert its Bitcoin trust into an ETF.
In a key ruling in August 2023, a US judge sided with Grayscale, calling the SEC’s reasons “arbitrary and capricious.” This court decision played a crucial role in paving the way for the approval of both Grayscale’s Bitcoin Trust and now, the GDLC ETF.
Grayscale has been a leader in creating investment products that allow people to gain exposure to digital assets without having to deal with the complexities of managing crypto wallets or private keys. This move to an ETF format signifies a growing maturity in the crypto market.
It potentially signals that regulators are becoming more open to future ETFs that include a broader range of smaller cryptocurrencies. This could mark the end of an era for older, less accessible closed-end crypto funds and usher in a new wave of more accessible crypto investment options.
More Crypto ETFs On The Horizon
Looking ahead, the SEC continues to evaluate other crypto-related ETF proposals. In a related development, the SEC recently opened a 35-day public comment period for Franklin Templeton’s applications to launch spot ETFs for XRP and Solana. These applications, originally filed in March 2025, are being reviewed under Section 6(b)(5) of the Exchange Act.
The new proceedings extend the timeline into July. “The Commission seeks comment on whether the proposal to list and trade Shares of the Trust, which would hold XRP, is designed to prevent fraudulent and manipulative acts and practices or raises any new or novel concerns not previously contemplated by the Commission,” The US Securities and Exchange Commission.