Grayscale, a prominent crypto asset manager, has officially filed with the United States Securities and Exchange Commission (SEC) to convert its $520 million Digital Large Cap Fund into an exchange-traded fund (ETF). The New York Stock Exchange (NYSE) submitted the request on Grayscale’s behalf in a 14 October filing. This move aims to simplify the buying and selling of shares for investors by creating a spot ETF that holds the underlying assets rather than relying on futures contracts.
Currently managing over $524 million in assets, the fund is heavily weighted in Bitcoin, accounting for 76% of its portfolio, with Ether making up 18%. The conversion comes on the heels of the SEC’s changing stance on crypto ETFs, following a favourable court ruling for Grayscale earlier this year. Previously, the SEC had rejected all applications for spot crypto ETFs, but the new developments indicate a shift in regulatory approach.
Investors have been offloading shares following the ETF conversions of Grayscale’s Bitcoin Trust and Ethereum Trust, with notable outflows recorded. Since the conversion to ETFs, Grayscale’s Bitcoin fund has seen $21 billion in outflows, while its Ethereum ETF has recorded $3 billion. Meanwhile, Grayscale continues to expand its offerings, recently adding 35 altcoins to its consideration list for future investment products.
Coinbase has filed a motion seeking partial summary judgment in its ongoing legal battle against the US Securities and Exchange Commission (SEC). The cryptocurrency exchange aims to access internal SEC documents, hoping to gain insight into the regulator’s approach toward the crypto industry. This stems from the SEC’s decision to deny requests under the Freedom of Information Act (FOIA) for crucial records on its enforcement strategies.
Coinbase, through History Associates, has been attempting to understand the SEC’s stance on digital assets, especially concerning the regulation of cryptocurrencies as securities. The SEC initially withheld documents under law enforcement exemptions but later acknowledged that these protections might no longer apply. Despite this, the regulator has delayed the document review process for three years, which Coinbase argues is unwarranted.
This motion is part of Coinbase’s broader efforts to challenge the SEC’s regulatory approach to the crypto sector, which many believe lacks clear guidelines. The case highlights the need for transparency regarding how the SEC enforces securities laws in the rapidly growing digital asset space.
US Vice President Kamala Harris is strengthening her connection with the cryptocurrency community through her “Opportunity Economy” agenda. She is set to speak with Black entrepreneurs in Erie, Pennsylvania, discussing her support for small businesses, cryptocurrency regulation, and cannabis legalisation at the federal level. The initiative aims to empower Black men by providing tools for home ownership, business creation, and wealth building.
Harris’s campaign has shifted its stance on digital assets. Once seen as part of an anti-crypto regime, her current position favours regulatory frameworks that protect crypto investors, including Black men who own such assets. Ripple co-founder Chris Larsen’s $1 million donation to her campaign signals a growing belief that Harris may work on bipartisan crypto legislation.
Despite this support, not everyone in the crypto community is convinced by her campaign’s shift. However, Harris remains focused on protecting crypto ownership rather than restricting it.
Deutsche Bank has entered a strategic partnership with Keyrock, a crypto-native market maker, to bolster its global market-making and OTC trading operations. The collaboration is set to improve settlement processes and expand Keyrock’s operations across regions like Europe, the Middle East, and Asia-Pacific. Deutsche Bank will provide multi-currency accounts and access to over 100 currency pairs, enabling Keyrock to trade efficiently and reduce settlement risks.
Keyrock CEO Kevin de Patoul welcomed the partnership, emphasising Deutsche Bank’s industry expertise and innovative approach. Kilian Thalhammer, Deutsche Bank’s Global Head of Merchant Solutions, noted that this move reflects the bank’s commitment to supporting fintech and blockchain advancements.
This partnership follows Deutsche Bank’s earlier steps into blockchain technology, including its involvement in Singapore’s Project Guardian. The bank’s proactive stance on digital assets highlights its increasing engagement with the evolving financial markets.
Alchemy Pay has announced that its Virtual Card service is now compatible with Samsung Pay, making cryptocurrency payments faster and more convenient for users. This new feature allows cardholders to connect their virtual crypto cards to Samsung Pay, adding to the previously available Google Pay option. By linking their card, users can now seamlessly pay with cryptocurrency both online and in-store at millions of global locations.
With this integration, Alchemy Pay is making digital assets more accessible to everyday shoppers, offering flexibility to spend crypto on major platforms such as Amazon, Netflix, and eBay. Cardholders simply add their Virtual Card to Samsung Pay and can start making payments immediately.
Alchemy Pay is focused on expanding its payment capabilities and plans to collaborate with major card networks like Visa and Mastercard soon. This is part of a broader strategy to enhance crypto payments for both experienced users and newcomers alike.
21Shares, a leading issuer of crypto exchange-traded products (ETPs), has called on the European Union to establish a unified regulatory framework for incorporating cryptocurrencies into investment products. The firm highlighted the current inconsistencies across member states, where countries like Germany and Malta allow crypto in UCITS funds, while others, such as Luxembourg and Ireland, do not.
A unified regulatory approach, 21Shares argues, would not only provide much-needed clarity for investors but also align Europe with other global markets, including the US and Hong Kong. By establishing clear guidelines, retail and institutional investors alike could benefit from greater diversification opportunities, all within a secure, regulated environment.
The European Securities and Markets Authority (ESMA) has already begun reviewing feedback on the inclusion of crypto assets in UCITS funds, with a decision expected to follow. 21Shares, which currently offers over 40 ETPs, believes this move would pave the way for greater access to digital assets in a regulated market.
The National Bank of Bahrain has launched its first bitcoin investment fund aimed at institutional investors in the Gulf Cooperation Council (GCC), which includes Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the UAE. Developed in partnership with ARP Digital, the fund allows investors to gain exposure to bitcoin while ensuring full protection against potential losses, albeit with a cap on possible gains.
Abdulla Kanoo, co-founder of ARP Digital, described the collaboration with NBB as a potential game-changer for the regional market. By combining ARP Digital’s expertise in digital assets with NBB’s strong presence in the financial sector, they have created a secure investment product for those looking to explore bitcoin.
Bahrain’s efforts to cultivate a crypto-friendly environment have attracted major players like Binance and Crypto.com, while the UAE is also advancing its regulatory framework for cryptocurrencies. In 2023, Dubai’s Virtual Asset Regulatory Authority issued comprehensive rules to facilitate Web3 firms operating in the region.
According to Chainalysis, the MENA region recorded $338.7 billion in crypto transactions between July 2023 and June 2024, primarily driven by institutional investors. With the new fund, NBB provides a promising opportunity for regional investors to safely engage with bitcoin in a well-regulated landscape.
A European Central Bank official has suggested the creation of a ‘European ledger,’ a blockchain platform that could bring together digital assets and money across the continent. This proposed platform, referred to as a digital capital markets union, would tackle Europe’s fragmented financial systems and outdated regulations, creating a more efficient environment for digital assets.
According to Piero Cipollone, an ECB executive board member, many European banks are already experimenting with distributed ledger technology (DLT), which could lead to greater financial integration. However, non-interoperable systems between countries continue to create fragmented liquidity. A unified platform could bring significant benefits, including cost reductions and round-the-clock operations, benefiting both investors and central banks.
Despite the advantages, concerns remain that a European ledger could stifle financial innovation. Cipollone noted that traditional finance might require the flexibility provided by competing DLT platforms to flourish. As discussions continue, the ECB is exploring ways to settle DLT transactions using central bank money, while seeking long-term solutions to avoid inefficiencies.
El Salvador’s President Nayib Bukele has met with Argentina’s President Javier Milei in Buenos Aires to discuss shared economic and security challenges. Their discussions included Milei’s zero-deficit budget strategy and Bukele’s experiences with debt management. Both leaders found common ground in their political journeys, particularly Bukele’s struggle with parliamentary opposition when he first took office.
During the visit, Bukele also met with Argentine senators and Vice President Victoria Villarruel to advise on cryptocurrency matters. Villarruel expressed significant interest in Bitcoin and El Salvador’s innovative use of Volcano Bonds for financing. These discussions signal Argentina’s growing interest in digital assets as part of its financial future.
Meanwhile, Uruguay has taken a major step in regulating cryptocurrency, passing a law that creates a clear framework for digital asset use. The law grants the central bank oversight of virtual asset service providers, ensuring compliance with anti-money laundering regulations whilst paving the way for new opportunities in the crypto sector.
The UAE has introduced amendments to its VAT regulations, exempting the transfer and conversion of digital assets, including cryptocurrencies, from VAT. This change, which applies retroactively from January 2018, will also benefit companies involved in managing investment funds. Businesses dealing with virtual assets are urged to review their past VAT positions to ensure proper input tax recovery, which enables them to claim back VAT paid on eligible purchases.
Virtual assets in the UAE are defined as representations of value used for digital trading or investment, excluding fiat currencies or financial securities. Meanwhile, regulators in the UAE have stepped up efforts to refine crypto regulations. Dubai’s VARA and the SCA have agreed to supervise virtual asset service providers jointly, allowing VASPs licensed in Dubai to operate across the wider UAE.
Additionally, the Virtual Asset Regulatory Authority has tightened rules on marketing, requiring firms to include disclaimers highlighting the volatility and potential loss in the value of digital assets. This move aims to ensure greater transparency in the rapidly growing crypto market.
