Regulators Give Green Light as Crypto Fund Moves Closer to Becoming an ETF

The U.S. Securities and Exchange Commission (SEC) has indicated it may soon grant approval for Grayscale Investments' Grayscale Digital Large Cap Fund (GDLC) to move from being a private trust to becoming a publicly listed exchange-traded fund (ETF). If this advancement is finalized, it would represent a notable change for one of the country's largest cryptocurrency investment vehicles. At present, the fund maintains significant positions in

(BTC), (ETH), along with several leading altcoins, making it a prominent option among institutional crypto investors.

Should the structural conversion go ahead, GDLC would provide investors with a more familiar approach to gaining exposure to a broad selection of major cryptocurrencies—without the need to directly buy or store the digital assets themselves. Currently, the fund operates as a private trust under the Investment Company Act of 1940, but the ETF format would bring it in line with standard fund regulations, which could enhance both liquidity and investor transparency.

Additionally, the change is expected to come with a new name for the fund to better fit typical ETF naming conventions. While Grayscale has yet to reveal the final ticker for the ETF, market experts predict it will likely highlight its multi-crypto nature instead of focusing solely on Bitcoin, reflecting rising interest in diversified crypto products from both institutional and accredited investors.

Though the SEC hasn't yet given full approval, it has acknowledged that Grayscale’s 19b-4 submission is complete, suggesting that the application is under active consideration. If the ETF is approved, GDLC would become the first multi-asset crypto ETF to reach the U.S. market, following numerous SEC rejections of single-asset Bitcoin ETF proposals. The fund's holdings indicate the ETF would include assets like Binance Coin (BNB),

(ADA), and (SOL), in addition to BTC and ETH.

Analysts in the industry suggest that such an approval could bring broader changes to the regulatory framework for crypto assets. The SEC’s consideration of the GDLC as an ETF—rather than as a commodity or investment trust—could point toward a more open-minded regulatory approach. Even so, given the SEC’s history of turning down Bitcoin ETF applications, the new product will need to clearly distinguish itself through its structure and adherence to compliance requirements.