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Grayscale Investments, LLC (“Grayscale”) is the world’s largest digital currency asset manager. With approximately $46B AUM,* Through its family of investment products, Grayscale provides access and exposure to the digital currency asset class in the form of a traditional security without the challenges of buying, storing, and safekeeping digital currencies directly.
With a proven track record, Grayscale’s products operate within the existing regulatory framework, creating exposure for investors in a secure and compliant manner.
Grayscale’s sponsored and managed products include Grayscale Basic Attention Token Trust (BAT), Grayscale Bitcoin Trust (BTC), Grayscale Bitcoin Cash Trust (BCH), Grayscale Chainlink Trust (LINK), Grayscale Decentraland Trust (MANA), Grayscale Ethereum Trust (ETH), Grayscale Ethereum Classic Trust (ETC), Grayscale Filecoin Trust (FIL), Grayscale Horizen Trust (ZEN), Grayscale Litecoin Trust (LTC), Grayscale Livepeer Trust (LPT), Grayscale Stellar Lumens Trust (XLM),Grayscale Zcash Trust (ZEC), and Grayscale Digital Large Cap Fund LLC. The trusts and the fund are collectively referred to herein as the “Products”. Any Product currently offering share creations is referred to herein as an “Offered Product”. Grayscale Bitcoin Trust is currently not an Offered Product.
Grayscale products are distributed by Genesis Global Trading, Inc. (Member FINRA/SIPC, MSRB Registered).
*As of April 1, 2021
Grayscale’s Private Placement Offerings
Shares of the Products are offered to institutional and individual accredited investors in private placement transactions exempt from the registration requirements of the Securities Act of 1933, as amended, pursuant to Rule 506(c) thereunder. Grayscale’s single-asset Products 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)
- Stellar Lumens (XLM)
- Zcash (ZEC)
Grayscale’s diversified Product, Grayscale Digital Large Cap Fund, provides exposure to the top liquid digital assets by market capitalization and currently holds BTC, ETH, LTC, BCH, and LINK.
Each Product’s investment objective is for the value of its shares (based on digital assets per share) to reflect the price performance of such Product’s underlying digital asset(s), less fees and expenses. Modeled after popular commodity investment products, each Product was created for investors seeking exposure to digital assets through a traditional investment vehicle.
Because each Product does not currently operate a redemption program, there can be no assurance that the value of such Product’s shares will reflect the value of the assets held by such Product, less such Product’s expenses and other liabilities, and the shares of such Product, if traded on any secondary market, may trade at a substantial premium over, or a substantial discount to, the value of the assets held by such Product, less such Product’s expenses and other liabilities, and such Product may be unable to meet its investment objective.
Grayscale’s Publicly-Traded Offerings
In addition, Shares of certain Products are publicly quoted on OTCQX® Best Market, the top tier operated by the OTC Markets Group, and Shares that have become unrestricted in accordance with the rules and regulations of the SEC may be bought and sold throughout the day via any brokerage account by retail investors. These Products include:
Grayscale® Bitcoin Trust (OTCQX: GBTC)
Grayscale® Bitcoin Cash Trust (OTCQX: BCHG)
Grayscale® Ethereum Classic Trust (OTCQX: ETCG)
Grayscale® Ethereum Trust (OTCQX: ETHE)
Grayscale® Litecoin Trust (OTCQX: LTCN)
Grayscale® Digital Large Cap Fund (OTCQX: GDLC)
These FAQs are qualified in all respects by the information in each Offered Product’s Private Placement Memorandum or each Product’s annual and quarterly reports, as applicable, including the Risk Factors therein.
Grayscale’s Products provide access and exposure to the digital currency asset class in the form of a security without the challenges of buying, storing, and safekeeping digital currencies directly. The Products are designed to provide investors with a cost-effective and convenient way to gain investment exposure to digital assets.
A substantial direct investment in digital assets may require expensive and time-consuming arrangements in connection with the acquisition, transfer, security and safekeeping of digital assets. Handling digital assets on one’s own can be risky, as the private keys that ensure access to an investor’s assets can be susceptible to loss or theft. This potentially exposes one’s digital asset position to partial or total loss, often with limited or no recourse. A substantial direct investment in digital assets may also involve the payment of substantial fees to digital asset exchanges.
In contrast, each Offered Product’s authorized participant executes large purchase and sale orders through exchanges and over-the-counter transactions to create shares for investors at a blended daily average price based on the respective digital asset’s Coindesk Price Index or Reference Rate. For more information on the Coindesk Index Provider, please visit their site.
The Products enable investors to avoid the challenges of acquiring, transferring, securing and safekeeping digital assets on their own. In addition to the risks of loss described above, individuals and institutions seeking to directly purchase or sell digital assets may often transact via unfamiliar intermediaries that in some cases may be unregulated and/or insecure. This often requires investors to transmit funds to jurisdictions where they might not be comfortable. Instead, an investment in the Shares enables investors to pass these tasks onto Grayscale and its service providers. In addition, unlike many direct investments in digital assets, an investment in the Shares entitles an investor to periodic and current reporting, audited financial statements, tax reporting and institutional-grade custody from reputable service providers that include the Trust’s sponsor, auditor, counsel and custodian. Collectively, these characteristics make an investment in the Shares convenient for investors and familiar to both them and advisors they may consult in connection with their investments, such as financial and tax advisors.
Certain of the Products are the only publicly traded investment products in the U.S. that allow investors to gain exposure to investment exposure to the Product’s underlying assets in the form of a security that can be held in a brokerage account alongside their other investments in stocks, bonds and other financial instruments.
Titled, Transferable, and IRA Eligible
Shares of the Products are also titled securities, which are similar to other common stocks and bonds that investors may own. Titled securities are familiar to financial and tax advisors, and easily transferred to beneficiaries under estate laws. Shares of the Products are also eligible to be held in certain IRAs, 401ks, and other brokerage and investment accounts. Consult your investment and tax advisors for additional information.
Important Risk Information
Carefully consider each Product’s investment objectives, risk factors, fees and expenses before investing. This and other information can be found in each Product’s private placement memorandum, which may be obtained from Grayscale and, for each Product registered with the SEC and/or listed on the OTC Markets, such Product’s annual report or information statement, which may be obtained by visiting the SEC’s website for Grayscale Bitcoin Trust (Symbol: GBTC) and Grayscale Ethereum Trust (Symbol: ETHE) or the OTC Markets website for Grayscale Bitcoin Cash Trust (Symbol: BCHG), Grayscale Ethereum Classic Trust (Symbol: ETCG), Grayscale Litecoin Trust (Symbol: LTCN) and Grayscale Digital Large Cap Fund (Symbol: GDLC). Reports on OTC Markets are not prepared in accordance with SEC requirements and may not contain all information that is useful for an informed investment decision. Read these documents carefully before investing.
Investments in the Products are speculative investments that involve high degrees of risk, including a partial or total loss of invested funds. Grayscale Products are not suitable for any investor that cannot afford loss of the entire investment. The shares of each Product are intended to reflect the price of the digital asset(s) held by such Product (based on digital asset(s) per share), less such Product’s expenses and other liabilities. Because each Product does not currently operate a redemption program, there can be no assurance that the value of such Product’s shares will reflect the value of the assets held by such Product, less such Product’s expenses and other liabilities, and the shares of such Product, if traded on any secondary market, may trade at a substantial premium over, or a substantial discount to, the value of the assets held by such Product, less such Product’s expenses and other liabilities, and such Product may be unable to meet its investment objective.
This information should not be relied upon as research, investment advice, or a recommendation regarding any products, strategies, or any security in particular. This material is strictly for illustrative, educational, or informational purposes and is subject to change.
The shares of each Product are not registered under the Securities Act of 1933 (the “Securities Act”), the Securities Exchange Act of 1934 (except for Grayscale Bitcoin Trust and Grayscale Ethereum Trust), the Investment Company Act of 1940, or any state securities laws. The Products are offered in private placements pursuant to the exemption from registration provided by Rule 506(c) under Regulation D of the Securities Act and are only available to accredited investors. As a result, the shares of each Product are restricted and subject to significant limitations on resales and transfers. Potential investors in any Product should carefully consider the long-term nature of an investment in that Product prior to making an investment decision. The shares of certain Products are also publicly quoted on OTC Markets and shares that have become unrestricted in accordance with the rules and regulations of the SEC may be bought and sold throughout the day through any brokerage account.