Grayscale Investments Files to Convert Its Digital Large Cap Fund (GDLC) into an Exchange-Traded Fund (ETF) Including XRP

The cryptocurrency investment landscape is evolving rapidly, and Grayscale Investments is at the forefront of this transformation. According to JackTheRippler

In a swift market response to Grayscale's latest move, Grayscale Investments has made headlines with its application to convert the Digital Large Cap Fund (GDLC) into a publicly traded exchange-traded fund (ETF) with the U.S. Securities and Exchange Commission (SEC).

Most notably, the ETF will include XRP, a significant milestone for the token amid its ongoing journey toward broader institutional acceptance.

Grayscale, renowned for Grayscale Bitcoin Trust (GBTC), recently achieved the launch of the first spot Bitcoin ETF in the U.S. This step marks a broader push to offer diversified crypto investment products in a regulated and publicly accessible manner.

The Digital Large Cap Fund is designed to track a basket of top cryptocurrencies, providing investors with exposure to leading digital assets. The fund already encompasses major assets like Bitcoin (BTC), Ethereum (ETH), Solana (SOL), and now XRP.

Among several noteworthy takeaways:

* Grayscale's application to the SEC comes after the approval of the first spot Bitcoin ETFs in the U.S., setting the stage for broader crypto product availability.

* The inclusion of XRP in the ETF is pivotal given the SEC's prior regulatory actions against the token, which some viewed as an impediment to broader institutional participation.

* If approved, the ETF could open up new avenues for U.S.-based investors to gain diversified exposure to cryptocurrencies through traditional investment channels.

Regulatory Shifts and ETF Approvals

Following the approval of the first spot Bitcoin ETF earlier this year, there is growing anticipation for the SEC's decision on other types of crypto ETFs.

Despite initial setbacks in 2024, several U.S. institutions, including Bitwise and WisdomTree, have already submitted applications for spot Ethereum ETFs.

Moreover, Grayscale is engaged in a legal battle against the SEC to overturn the agency's rejection of Gbtc's conversion into a spot Bitcoin ETF earlier this year.

A setback in the case could hinder the approval prospects of other institutions' applications.

A setback in the case could hinder the approval prospects of other institutions' applications.

Grayscale's move to apply for the Digital Large Cap Fund ETF comes amid a broader shift in the regulatory landscape for crypto products.

Earlier this year, the SEC also took action against major cryptocurrency exchange Binance and its U.S. subsidiary for allegedly operating without the required registrations.

In a separate development, a federal judge ruled in favor of Ripple Labs in the SEC's case against the blockchain firm. The SEC had been attempting to classify XRP as a security.

However, the judge's decision, which is still subject to appeal by the SEC, could have implications for how other crypto tokens are regulated in the U.S.