The U.S. Securities and Exchange Commission (SEC) has approved the conversion of Grayscale Investments' Digital Large Cap Fund (GDLC) into a spot cryptocurrency exchange-traded fund (ETF), marking the first multi-crypto basket ETF in the United States.
The fund, which holds Bitcoin, Ethereum, XRP, Solana, and Cardano, will trade on NYSE Arca following the announcement on July 1, 2025.
This approval reflects growing regulatory support for digital assets, though concerns about market stability and investor protection persist.
SEC Approves Grayscale’s Multi-Crypto ETF
The SEC's accelerated approval enables Grayscale’s Digital Large Cap Fund—previously listed on OTC Markets under the ticker GDLC since 2019—to transition into a spot ETF on NYSE Arca. The fund tracks the CoinDesk 5 Index (CD5) and managed approximately $775 million in assets as of June 30, 2025.
Portfolio Composition:
- 80% Bitcoin
- 11% Ethereum
- 4.8% XRP
- 2.8% Solana
- 0.8% Cardano
The approval amends NYSE Arca Rule 8.500-E and complies with Section 6(b)(5) of the Securities Exchange Act of 1934, ensuring measures to prevent fraud and market manipulation.
This decision follows Grayscale’s 2023 legal victory against the SEC, where a court ruled the agency’s denial of a Bitcoin ETF as arbitrary. That precedent led to spot Bitcoin ETF approvals in January 2024 and Ethereum ETFs in July 2024. The GDLC conversion sets the stage for broader altcoin adoption in regulated investment vehicles.
David LaValle, Grayscale’s head of ETFs, called the approval a “milestone for diversified crypto exposure.” Bloomberg analyst James Seyffart predicts a 90% approval probability for similar filings, citing favorable regulatory trends.
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The Impact of Grayscale’s Converted Fund
The GDLC ETF offers institutional and retail investors:
- Intraday trading
- Lower costs compared to OTC products
- Integration with standard brokerage accounts
With 91% allocated to Bitcoin and Ethereum, the fund aims to reduce volatility risk while providing regulated crypto access.
Regulatory Considerations:
- XRP, Solana, and Cardano have faced SEC scrutiny in the past.
- The fund’s 8.1% allocation to these assets may mitigate regulatory concerns.
- The SEC is reviewing single-asset ETFs for XRP, Solana, and Cardano, with decisions expected by October 2025.
Nate Geraci of ETF Store notes that this approval could influence global markets, as U.S. regulatory actions often set precedents.
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What’s Next?
As the first multi-crypto basket ETF in the U.S., GDLC may catalyze similar funds, such as Bitwise’s 10 Crypto Index Fund, pending SEC review.
Key Takeaways:
- Global trend: Digital assets are increasingly integrated into traditional finance.
- Regulatory focus: Custody risks and surveillance remain SEC priorities.
- Investor caution: Market complexity and evolving regulations demand careful analysis.
FAQs:
1. What is a multi-crypto ETF?
A fund holding multiple cryptocurrencies, offering diversified exposure in a single investment vehicle.
2. Why is Grayscale’s ETF significant?
It’s the first U.S.-approved ETF to include Bitcoin, Ethereum, XRP, Solana, and Cardano.
3. How does this approval impact crypto markets?
It signals growing regulatory acceptance and could attract institutional investors.
4. Are there risks with multi-crypto ETFs?
Yes, including volatility, regulatory changes, and asset-specific legal challenges.
5. Will more altcoin ETFs follow?
Likely, as demand grows and regulators refine frameworks.
By balancing diversification with regulation, Grayscale’s ETF represents a major step forward for crypto accessibility. Stay informed as the landscape evolves!
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