Grayscale Investments has introduced a new investment fund designed for affluent clients seeking to diversify their portfolios with income derived from staking cryptocurrency tokens.
Named the Grayscale Dynamic Income Fund, it targets individuals with assets exceeding $1.1 million or a net worth above $2.2 million.
The fund’s strategy involves converting staking rewards into U.S. dollars on a weekly basis, with plans to distribute these earnings to investors quarterly.
Grayscale emphasizes the thorough vetting process for selecting proof-of-stake (PoS) tokens to include in the fund, aiming to manage the intricacies of staking and unstaking various tokens, each with unique requirements.
The firm prioritizes maximizing staking income, viewing capital growth as a secondary goal.
Staking, a process that contributes to the security and efficiency of blockchain networks, involves holding cryptocurrency tokens to earn rewards.
Grayscale has disclosed that its fund will comprise three specific PoS tokens: Osmosis (OSMO), Solana (SOL), and Polkadot (DOT), with respective shares of 24%, 20%, and 14%.
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The remaining 43% of the fund is allocated to other tokens.
According to Staking Rewards data, the staking reward rates for OSMO, SOL, and DOT are 11.09%, 7.42%, and 11.9%, respectively, with only SOL ranking in the top 10 PoS tokens by market capitalization on CoinMarketCap.
In related news, Grayscale’s venture into a spot Bitcoin exchange-traded fund (ETF) on January 11 has faced challenges, with over $14 billion in outflows since its inception, as reported by Cointelegraph on March 26.
The Bitcoin ETF, which incurs a 1.5% management fee annually—significantly higher than the 0.30% average of other Bitcoin ETFs—has not met the firm’s expectations.
Additionally, Grayscale’s application for an Ethereum Futures ETF has been met with delays by the United States Securities and Exchange Commission, further complicating the company’s ambitious cryptocurrency investment endeavors.
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