- According to a report from ETF.com, the crypto boom in Bitcoin and Ether has helped Grayscale generate the same income as Vanguard from its set of 82 ETFs.
- The Grayscale Bitcoin and Ethereum funds generate about $ 1 billion in combined revenue.
- The rise in Bitcoin and Ether from the beginning of the year to the present, at roughly 100% and 300%, has helped lift Grayscale’s assets under management to record levels.
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The rise in Bitcoin and Ether over the past year has helped boost Grayscale’s estimated revenue from just the two funds it manages to about $ 1 billion, the same amount Vanguard generates from its entire set of 82 ETFs, according to a report by ETF.com.
The Grayscale Bitcoin Trust, a semi-closed fund that charges 2% per annum, generates $ 756 million in estimated revenue from its $ 36 billion under management.
When you add in the estimated revenue generated from the Grayscale Ethereum Trust’s 2.5% annual commission and $ 10 billion in assets, the two Grayscale funds generate approximately $ 1 billion in annual revenue.
“For Grayscale, the opportunity to raise close to $ 1 billion from just two products – the amount Vanguard gets from all 82 of its ETFs – is really impressive,” said ETF.com analyst Sumit Roy.
Grayscale’s assets under management skyrocketed to record levels amid strong growth in Bitcoin and Ether, which are up 83% and 342% YTD, respectively.
Aside from the big cryptocurrency growth over the past year, Grayscale has benefited from being the only game in town, offering investors the ability to easily add cryptocurrency to their brokerage portfolios without having to buy bitcoin directly with a digital wallet.
This perennial exclusivity has given Grayscale the ability to charge a hefty fee compared to most funds and ETFs.
But Grayscale’s dominance in the bitcoin space could face pressure in the coming months as competition intensifies. The Osprey Bitcoin Trust is already slashing Grayscale fees by 1.50%, and the SEC is considering approving several bitcoin ETFs that could open gateways for investors who add or remove bitcoins from their investment portfolios too easily.
If the SEC approves one or more pending applications for Bitcoin ETFs, it is likely to be cheaper and easier for investors compared to OTC cryptocurrency trust products from Grayscale and Osprey, since the ETFs will be listed on the exchange. not in the over-the-counter market.
But with multi-year startup Grayscale, it can take a long time for asset management companies to succeed.
Read more: Former Ark analyst James Wan reveals his bullish case for Ethereum as his token surpasses an all-time high of $ 3,300 – and explains why it could eventually reach $ 40,000.