Crypto Investment Firm Grayscale Brings In $330 Million Even as Market Sags
*by Tanaya Macheel*
Next year may signal a more widespread adoption of crypto among institutional investors ー if the current momentum continues, that is.
Grayscale, a veteran digital currency investment firm, saw record inflows, $330 million in the first three quarters of 2018 ー most of which came from institutional investors including hedge funds, endowments and pensions, according to the managing director.
“That’s against nothing but price decline,” which investors are using as “a time to create \[an\] initial position or start scaling into a position” in Bitcoin or other crypto assets, Michael Sonnenshein told Cheddar on Friday.
In the third quarter, 73 percent of inflows were into the Bitcoin Investment Trust, while 27 percent were into Grayscale products tied to other digital assets, according to Grayscale’s third-quarter Digital Asset Investment Report, published Thursday.
For the year to date, Bitcoin accounted for 66 percent of total assets raised and 34 percent went into other digital assets.
Most of Grayscale’s capital inflows are going to its Bitcoin product because investors are most familiar and comfortable with it. Eight of Grayscale’s nine different products are for single currencies ーlike Bitcoin or XRP. The ninth is a bundle that offers exposure to the largest digital currencies by market cap.
“We’re starting to see a lot more interest in those types of structures, especially in the wake of seeing other firms shut down their index products,” Sonnenshein said of the large cap fund.
“A lot of folks want to generally allocate to the space and not have to choose winners or avoid losers and like the idea of the large cap fund for that very reason.”
Since late last year’s run-up, when the price of Bitcoin reached nearly $20,000, Fidelity, the third-largest asset manager in the world, announced plans to launch a crypto custody and institutional brokerage business. Goldman Sachs announced plans to open a crypto trading operation. Intercontinental Exchange, the parent company of the New York Stock Exchange, has entered the crypto industry through a new company called Bakkt. Earlier this week, Morgan Stanley released a bullish report on cryptocurrencies, hailing Bitcoin and other digital assets as a "new institutional investment class.”
“The once taboo nature of investing in digital currencies has been shrugged off by most investors. When we go sit down with our hedge fund clients, endowments, whatever they may be, there is so much knowledge on the other side of the table that, to us, is really validating," Sonnenshein said.
For full interview [click here](https://cheddar.com/videos/morgan-stanley-says-cryptocurrencies-are-a-new-asset-class).
Amid weeks of recent controversy, Facebook this week announced it would be changing its corporate name to Meta as it pivots to the metaverse and virtual reality products. Dan Ives, Managing Director of Equity Research at Wedbush Securities, joins Cheddar News' Closing Bell to discuss the rebrand, whether chief Mark Zuckerberg can separate his identity from the company, and what the rebrand means for shareholders.
Cryptocurrency platform Blockchain.com launched margin trading on its exchange earlier this month. The company's Chief Business Officer, Lane Kasselman, joins Cheddar News' Closing Bell, where he discusses how margin trading works in the crypto space and what users will be able to do on the platform.
Apple reported strong fourth quarter earnings, but sales fell below expectations. CEO Tim Cook said chip shortages and manufacturing delays cost the company $6 billion. The issues have led to the newly-launched iPhone 13 Pro being in short supply around the world, as well as to back orders for Apple's new Macbook Pro. Exponential Investment Partners Managing Partner Kevin Riley joined Cheddar News' Closing Bell to discuss.
Electric bike company Dance recently raised $19.4 million, just weeks after rolling out its e-bike subscription service in Berlin. Dance allows users to subscribe to use an e-bike for around €79, or about $91, a month. Dance says its subscription model allows the company to reuse and refurbish its products, and further its mission to build more sustainable and livable cities. Dance founder and CEO Eric Quidenus-Wahlforss joined Cheddar News' Closing Bell to discuss.
Project management platform ClickUp raised $400 million in Series C funding this week, and founder and CEO Zeb Evans joined Cheddar's "Closing Bell" to talk about taking the added funds to help make the workplace more efficient by being a one-stop-shop for office needs. He also discussed a growing demand for his company's services during the pandemic as companies seek solutions to keep their employees on the same page.
How much real money would you pay for a virtual plot of land? Developing technology is introducing everyone in the real world to new, virtual worlds, like Decentraland. In this metaverse economy, users are buying virtual real estate at high value – and it’s not just the average Joe that’s looking to invest. Company's like Facebook are betting big.
The dating app Hinge says it's taking online dating to the next level by introducing a voice prompt feature for profiles. Michelle Parsons, chief product officer, joined Cheddar to talk about providing the question prompts for users to make accounts more personable in their own voice. She also went into how much the pandemic has had an impact on engagement.
TikTok is testing out a new program that would allow creators to receive tips for their posted content. The video-sharing platform also said it will allow creators to retain 100 percent of their tipped revenue.
