Grayscale, the popular traditional equities fund allowing traditional and institutional investors to gain Bitcoin through traditional brokerages has posted steadily increasing and record-breaking numbers in terms of inflows, institutional reach, and actual crypto purchased to maintain 1:1 reserves. Below is a breakdown of the quarterly investment inflows and data according to each Grayscale quarterly investment report.
Q1 2020 Investment Highlights2
Total Investment into Grayscale Products: $503.7 million
Average Weekly Investment – All Products: $38.7 million
Average Weekly Investment – Grayscale® Bitcoin Trust: $29.9 million
Average Weekly Investment – Grayscale® Ethereum Trust: $8.5 million
Average Weekly Investment – Grayscale Products ex Bitcoin Trust3: $8.8 million
Majority of investment (88%) came from institutional investors, dominated by hedge funds.
Hedge Fund Investment Gains Steam: 88% of inflows this quarter came from institutional investors, the overwhelming majority of which were hedge funds. The mandate and strategic focus of these funds is broadly mixed and includes Multi-Strat, Global Macro, Arbitrage, Long/Short Equity, Event Driven, and Crypto-focused funds.
Investors Further Diversify: Approximately 38% of investors now have allocations to multiple products within the Grayscale family, up from 29% at the end of 1Q19.
Q2 2020 Investment Highlights2
Total Investment into Grayscale Products: $905.8 million
Average Weekly Investment – All Products: $69.7 million
Average Weekly Investment – Grayscale® Bitcoin Trust: $57.8 million
Average Weekly Investment – Grayscale® Ethereum Trust: $10.4 million
Average Weekly Investment – Grayscale Products ex Bitcoin Trust3: $11.9 million
Majority of investment (84%) came from institutional investors, dominated by hedge funds.
New Investor Interest and Multi-Product Institutional Investors: In 2Q20, new investors accounted for $124.1 million of inflows and 57% of the investor base. Additionally, 81% of returning institutional investors in 2Q20 have now allocated to multiple products, an increase from T12M of 71%.
Q3 2020 Investment Highlights2
Total Investment into Grayscale Products: $1.05 Billion
Average Weekly Investment – All Products: $80.5 million
Average Weekly Investment – Grayscale® Bitcoin Trust: $55.3 million
Average Weekly Investment – Grayscale® Ethereum Trust: $15.6 million
Average Weekly Investment – Grayscale® Digital Large Cap Fund: $3.5 million
Average Weekly Investment – Grayscale Products ex Bitcoin Trust3: $25.2 million
Majority of investment (84%) came from institutional investors, dominated by hedge funds.
Billion Dollar Quarter: Grayscale recorded its largest ever quarterly inflows, over $1.0 billion in 3Q20, making it the third consecutive record-breaking quarter. Year-to-date investment into the Grayscale family of products has surpassed $2.4 billion, more than double the $1.2 billion cumulative inflow into the products from 2013-2019. Cumulative investment across the Grayscale family of products since inception now totals $3.6 billion.7
Grayscale Bitcoin Trust Among Fastest Growing Investment Products: Grayscale Bitcoin Trust experienced $719.3 million in 3Q20 inflows. The Trust has seen its assets under management (“AUM”) surge from $1.9 billion to $4.7 billion YTD. Grayscale Bitcoin Trust does not operate a redemption program and its shares do not trade on a national securities exchange. The trust is therefore not an ETP or ETF. Still, if the Trust were compared to global ETPs and ETFs with over $1B AUM at the start of the year, it would rank as the third-fastest growing product YTD with an AUM increase of approximately 147%.
As you can see, Grayscale has seen massive investor inflows in 2020, likely contributing to Bitcoin's stellar rise and breakout. However, what's clear is that the trend is not only in Bitcoin's favor, but is spreading over into other cryptos as well, namely Ethereum.
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