Investors can now access diversified exposure to the DeFi ecosystem through a single, publicly-quoted investment vehicle
STAMFORD, Conn., Dec. 09, 2022 (GLOBE NEWSWIRE) — Grayscale Investments®, the world’s largest digital currency asset manager, today announced that Grayscale® Decentralized Finance Fund (DeFi Fund) has begun trading on OTC Markets under the symbol: DEFG. Grayscale now offers 15 digital currency investment products trading on OTC Markets.
“We believe that investors deserve access to the digital currency ecosystem through secure products, and are excited to now offer them exposure to the evolving decentralized finance sub-sector through a publicly-quoted security,” said Grayscale Head of Investor Solutions, Rayhaneh Sharif-Askary.
DEFG enables investors to gain exposure to the price movement of a diversified basket of DeFi digital assets through a singular investment vehicle. DEFG tracks the CoinDesk DeFi Select Index (DFX) and is rebalanced quarterly – allowing investors to avoid the challenges of buying, storing, and safekeeping digital currencies directly.
The protocols underlying DEFG digital assets seek to democratize access to financial services, such as borrowing, lending, custody, trading, derivatives, asset management and insurance, by removing third-party intermediaries.
SECONDARY MARKET for the PRIVATE PLACEMENT
DEFG has offered a private placement to accredited investors since July 2021. As of December 8, 2022, there were 233,960 Shares outstanding of DEFG. Shares created through DEFG’s private placement become eligible to sell into the public market after a statutory one-year holding period pursuant to Rule 144 of the Securities Act of 1933.*
All investors with access to U.S. securities will be able to buy and sell freely-tradable DEFG shares through their investment accounts, in the same manner as other securities.
DEFG provides exposure to a diverse selection of digital assets that meet the fund’s construction criteria through a market capitalization-weighted portfolio (Fund Components). As of December 8, 2022, DEFG’s Fund Components were a basket of 68.88% Uniswap (UNI), 13.00% Aave (AVE), 8.89% Maker (MKR), 5.14% Curve (CRV) and 4.09% Compound (COMP).
The investment objective of DEFG is for the Shares (based on Fund Components per Share) to reflect the value of the Fund Components, determined by reference to the Digital Asset Reference Rate and weighting for each Fund Component less DEFG’s expenses and other liabilities. As of December 8, 2022, each Share represented 1.5431 Uniswap (UNI), 0.0285 Aave (AAVE), 0.0020 Maker (MKR), 1.0763 Curve (CRV) and 0.0147 Compound (COMP). DEFG will not generate any income and regularly distributes Fund Components to pay for its ongoing expenses. Therefore, the amount of Fund Components represented by each Share gradually decreases over time.
The Fund Components consist of the digital assets that make up the DFX as rebalanced from time to time, subject to the Grayscale’s discretion to exclude individual digital assets in certain cases. The composition of DEFG is evaluated on a quarterly basis** to remove existing Fund Components or to include new Fund Components in DEFG’s portfolio, in accordance with the rebalancing of DFX and DEFG’s fund construction criteria established by Grayscale. DEFG may also hold cash and assets arising as a result of a fork, airdrop, or similar event from time to time.***
DEFG is not registered with the Securities and Exchange Commission and is not subject to disclosure and certain other requirements mandated by U.S. securities laws.
GRAYSCALE PRODUCT FAMILY
Grayscale’s investment products are available to institutional and individual accredited investors through their respective periodic and ongoing private placements. In addition to DEFG, Grayscale’s other diversified products are Grayscale Digital Large Cap Fund, which provides exposure to the largest and most liquid digital assets through a market cap-weighted portfolio designed to track the CoinDesk Large Cap Select Index (DLCS), and Grayscale Smart Contract Platform Ex-Ethereum Fund, which provides exposure to a selection of industry-leading Smart Contract Platforms through a market cap-weighted portfolio designed to track the CoinDesk Smart Contract Platform Select Ex ETH Index (SCPXX).
Grayscale also offers investors exposure to digital assets through its single-asset investment products which provide exposure to Basic Attention Token (BAT), Bitcoin (BTC), Bitcoin Cash (BCH), Chainlink (LINK), Decentraland (MANA), Ethereum (ETH), Ethereum Classic (ETC), Filecoin (FIL), Horizen (ZEN), Litecoin (LTC), Livepeer (LPT), Solana (SOL), Stellar Lumens (XLM), and Zcash (ZEC).
This newly-trading product means that Grayscale now offers investors a total of 15 products with public quotations. Grayscale® Basic Attention Token Trust (OTCQB: GBAT), Grayscale® Bitcoin Trust (OTCQX: GBTC), Grayscale® Bitcoin Cash Trust (OTCQX: BCHG), Grayscale® Chainlink Trust (OTCQB: GLNK), Grayscale® Decentraland Trust (OTCQX: MANA), Grayscale® Ethereum Trust (OTCQX: ETHE), Grayscale® Ethereum Classic Trust (OTCQX: ETCG), Grayscale® Filecoin Trust (OTCQB: FILG), Grayscale® Horizen Trust (OTCQX: HZEN), Grayscale® Litecoin Trust (OTCQX: LTCN), Grayscale® Livepeer Trust (OTCQB: GLIV), Grayscale® Stellar Lumens Trust (OTCQX: GXLM), Grayscale® Zcash Trust (OTCQX: ZCSH) and Grayscale® Digital Large Cap Fund (OTCQX: GDLC) are also publicly-quoted and available to all investors with access to U.S. securities. Investors will be able to find current financial disclosure and Real-Time Level 2 quotes for Shares on www.otcmarkets.com/stock/DEFG/disclosure once trading for DEFG commences.
*Because Grayscale DeFi Fund does not currently operate a redemption program, there can be no assurances that the value of the private placement Shares will approximate the value of the underlying assets held by DeFi when traded on a secondary market, like OTCQB. As such, the Shares of the public quotation may trade at a substantial premium over, or substantial discount to, the value of the assets held by DeFi.
**DEFG’s Fund Components are evaluated on a quarterly basis, beginning on the second business day of January, April, July, and October of each year.
***Forks, airdrops, and similar events are evaluated on a case-by-case basis in consultation with DEFG’s legal advisors, tax consultants, and custodian. There are likely to be operational, tax, securities law, regulatory, legal, and practical issues that significantly limit, or prevent entirely, DEFG’s ability to realize a benefit from any forks, airdrops, or similar events.
This press release is not an offer to sell or the solicitation of an offer to buy any security in any jurisdiction where such an offer or solicitation would be illegal, nor shall there be any sale of any security in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of that jurisdiction.
About Grayscale Investments®
Grayscale enables investors to access the digital economy through a family of secure, regulated, and future-forward investment products. Founded in 2013, Grayscale has a proven track record and deep expertise as the world’s largest digital currency asset manager. Investors, advisors, and allocators turn to Grayscale for single asset, diversified, and thematic exposure. Grayscale products are distributed by Grayscale Securities, LLC (Member FINRA/SIPC). For more information, please follow @Grayscale or visit grayscale.com.