Grayscale officially launches smart contract platform fund which will provide more exposure to seven smart contract coins but not ETH so let’s read more in today’s latest cryptocurrency news.
This is among the most popular crypto asset managers and now Grayscale officially launches the Grayscale Smart Contract Platform which will include exposure to a variety of cryptocurrencies that power major smart contract networks alongside Ethereum. As announced in their press release, the fund marked the company’s 18th investment product and the third diversified fund offering while adjusting the exposure to various cryptocurrencies.
The fund consisted of 24.6% ADA, 16.96% AVAX, 24.27% SOL, 16.16% DOT, 9.65% MATIC, 4.06% XLM and 4.27% ALGO. This is based on the performance of every cryptocurrency at the time but BNB and LUNA are notable absent. The Smart Contract Platforms are blockchains that users can use to create open-source code to power trustless transactions. This also allows for a variety of decentralized applications to be built on the network which is a more popular subset of which includes DEFI.
However, smart contracts can make users more susceptible to hacks and exploits while taking up even more space on the blockchain. Some networks like DOGE and BTC are not easily programmable for smart contracts. Regarding the fund, Grayscale CEO Michael Sonnenshein said that with crypto growing, more investors are seeking diversified exposure to the market. He stated:
“Smart contract technology is critical to the growth of the digital economy, but it’s still too early to know which platform will win. The beauty of [the fund] is that investors do not have to choose one winner, and instead can access the development of the smart contract platform ecosystem through a singular investment vehicle.”
Businessman Kevin O’Leary also noted the importance of diversification in crypto as he now has 20% of his wealth invested in 32 different positions on the market including Solana, Avalanche, and Ethereum. It is worth noting that crypto remains correlated in price and makes the benefit of diversification limited. For example, CoinMetrics measures a correlation of 0.89 between BTC and ETH. Some of the other Grayscale products include its Bitcoin Trust which comprises the biggest BTC fund in the world and even tried to convert the fund into a US-based spot ETF but has to be approved by the SEC.
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