Grayscale Investments has hit a third consecutive record-breaking quarter in which it raised over $1bln into its various investment products.
According to its latest quarterly investment report for Q3 of 2020, a total of $1.05 bln was raised which is the largest quarterly inflow that the company has ever seen. Grayscale’s investment in the year-to-date has surpassed $2.4 bln which it claims is more than double its $1.2 billion inflow over an entire six year period from 2013 to 2019.
A quick overview of Grayscale Products investments shows its weekly investments raised were around $80.5mln across all of its investment products. The Grayscale Bitcoin Trust saw an average weekly investment of $55.3mln while the Ethereum Trust attracted an average weekly investment of $15.6mln.
The report outlines that the majority of investments, totalling 84%, came from institutional investors the majority of which were hedge funds.
Grayscale Bitcoin Trust seeing fastest growth
Grayscale’s report shines a spotlight on what can only be described as a monumental influx in capital from investors into the firm’s Bitcoin Trust.
The Grayscale Bitcoin Trust saw $719.3mln invested by its clients in the third quarter of 2020. Perhaps more impressive is the overall growth of its assets under management (AUM), which has grown from $1.9bln to $4.7bln over the past 12 months.
While stipulating that the Grayscale Bitcoin Trust does not operate a redemption program and its shares are not traded on a securities exchange, the Trust would be rated as the third-fastest growing product in the last year if compared to other global exchange traded products or funds that hold over $1bln in AUM.
Demand for alt coins growing
The report also outlines a growing demand for investment products that hold alternative assets other than Bitcoin, which remains a major focus for investors.
According to Grayscale, 31% of investment inflows were allocated to products which excluded Bitcoin in Q3 of 2020.
The most notable among these has been the Grayscale Bitcoin Cash Trust, Litecoin Trust and the Grayscale Digital Large Cap. The report claims that these products saw an increase in investment inflows of more than 1400% between quarters.
2020 has been good for Grayscale
2020 has been a phenomenal year for Grayscale and its Bitcoin Trust in particular. It’s August 2020 Q2 report was equally as impressive as this month’s filing – capping off ten months of massive growth since the Grayscale Bitcoin Trust became an SEC reporting company in January 2020.
The company became the first over-the-counter, publicly traded Bitcoin investment vehicle in 2015 but there were certain barriers that prevented institutional investors from getting involved.
That changed some 8 months ago when the Grayscale Bitcoin Trust was officially registered with the SEC. This allowed investors that were barred from investing in non-regulated vehicles to finally gain exposure to various cryptocurrencies through the company.
One of the conditions of being an SEC reporting company is that a company must publicly file quarterly and annual reports with the regulatory body. This will afford transparency when it comes to the holdings and performance of the Trust.