Inventory of 21 grayscale encrypted trust funds: some have risen 10 times, while others have continued to decline. Is it easy to step on the last train of the bull market and become a market counter-indicator?
Currently, Grayscale's cryptocurrency trusts have reached 21, and what impact will Grayscale's launch of trust funds have on these crypto assets?Author: Frank, PANews
In the past six months, Grayscale has launched six cryptocurrency trust funds again. After August 1, SUI experienced a surge following Grayscale's launch of the trust fund, leading to the widespread view that "Sui is the Solana killer."
Currently, Grayscale's cryptocurrency trusts have reached 21 (excluding BTC and ETH). What impact will Grayscale's launch of trust funds have on these cryptocurrencies? According to PANews' summary, the impact of Grayscale's trust funds on token prices is highly differentiated; they have a significant boosting effect on leading projects in popular market sectors, while having minimal impact on long-established coins. Additionally, it seems that Grayscale's concentrated launches of cryptocurrency trusts have often coincided with the end of bull markets.
GDLC: Entered Bear Market After Launch
Launch Date: February 1, 2018 Assets Under Management: $480 million
GDLC (Grayscale Digital Large Cap Fund) is a basket of large-cap digital asset products launched by Grayscale, currently holding several tokens including BTC, ETH, SOL, XRP, and AVAX. The plan was launched in February 2018, at a time when the market was experiencing a decline from the historical high of 19891 to over $7000. After Grayscale launched this product, the market entered a long period of consolidation and decline. The launch of this product does not seem to have provided much of a boost to the market.
ETC: Price Surge After Launch During Recovery Phase
Launch Date: April 24, 2017 Assets Under Management: $210 million
After Grayscale launched the ETC product, the price of ETC rose significantly. However, this increase seems to have occurred prior to Grayscale's trust product, as the entire cryptocurrency market was entering a recovery phase in April 2017. The ETC trust product is one of the earliest trust products launched by Grayscale.
BCH: Halved After Launch
Launch Date: March 1, 2018 Assets Under Management: $120 million
The short-term market impact of Grayscale's trust fund on BCH seems to have been minimal. When Grayscale launched the BCH trust on March 1, 2018, BCH was at a high point, and after the product was launched, the price fell sharply, dropping about 53% in a month.
LTC: Dropped 70% After Bull to Bear Transition
Launch Date: March 1, 2018 Assets Under Management: $118 million
Grayscale also chose to launch the LTC trust product right after a significant price increase, but it did not have much impact on the LTC market. On March 1, 2018, LTC briefly rebounded by about 7%, but then began to decline a few days later, dropping from $200 to $72.
SOL: Launched After Historical Peak
Launch Date: November 18, 2021 Assets Under Management: $69.87 million
When Grayscale launched, SOL had just begun to decline after reaching a previous high of $259. After the launch of the trust product, the market briefly rebounded, but then continued to decline, entering a long bear market.
Zcash: Reached Historical High After Launch
Launch Date: October 24, 2017 Assets Under Management: $16.26 million
Since the announcement of its establishment, Zcash saw a maximum increase of 29.64% within four days. After Grayscale launched the Zcash trust, the market entered the latter half of a bull market, with prices soaring; Bitcoin reached a high of $19891, and Zcash also rose sharply, creating a historical high price of $799.
XLM: Declined After Bull to Bear Transition
Launch Date: December 6, 2018 Assets Under Management: $9.4 million
The market performance after the launch was poor, with XLM's price in a downward trend. The market reached its lowest point on December 16, with Bitcoin's price dropping to $3215, followed by a rebound to nearly $14000. However, XLM's price continued to decline and was not significantly stimulated by the launch of Grayscale's trust.
LINK: Experienced 124% Increase
Launch Date: February 26, 2021 Assets Under Management: $9.39 million
As a trust product launched alongside MANA, LINK's market performance was not as strong as MANA's. However, in the two and a half months following the launch of the trust, LINK saw an increase of 124%, outperforming other mainstream tokens during the same period.
MANA: Increased 543% in One Month
Launch Date: February 26, 2021 Assets Under Management: $7.64 million
MANA experienced a significant increase after Grayscale launched its trust product. On February 26, 2021, Grayscale launched the MANA trust, and in the following month, MANA surged by 543%. It became the most eye-catching investment target in the market at that time, coinciding with the peak interest in the metaverse concept. MANA was also the only metaverse product for which Grayscale launched a trust. Currently, Grayscale's trust still accounts for 1.45% of MANA's total market capitalization.
LPT: Nearly 10-Fold Surge After Launch
Launch Date: March 10, 2021 Assets Under Management: $6.9 million
Grayscale's trust had a significant market-driving effect on LPT. As a relatively new token, LPT had not yet been listed on exchanges like Binance and OKX by March 2021. After Grayscale launched the LPT trust on March 10, the price of LPT surged from $4.8 to $40. During the same period, the market was in a high-level consolidation phase, while LPT experienced an independent rally.
FIL: Tripled to Reach Historical High
Launch Date: March 15, 2021 Assets Under Management: $5.32 million
Grayscale's market boost for FIL was quite significant. After Grayscale launched the FIL trust on March 15, FIL's price surged by 19% the next day, and on March 17, it rose by 39%, reaching a historical high of $237 on April 1. However, the market was also in a bullish sentiment at that time, with Bitcoin first reaching $60,000. Additionally, FIL's community promotion was also in full swing, and Grayscale's trust product likely provided a strong endorsement for the market.
ZEN: Entered Bear Market and Continued to Decline
Launch Date: August 6, 2018 Assets Under Management: $4.9 million
When Grayscale launched the ZEN trust, the market was in a phase of downward consolidation, so the trust product did not have much impact on ZEN's market. After the launch, ZEN's price continued to decline from $21 to around $4. However, this decline was also in line with the overall market trend. Grayscale's ZEN trust currently accounts for 3.86% of ZEN's total market capitalization.
BAT: Highest Increase of 273%
Launch Date: March 1, 2018 Assets Under Management: $120 million
On the day Grayscale launched the BAT trust, BAT experienced significant volatility, with a daily fluctuation of 26% and a closing increase of 9.19%. However, BAT then experienced a strong rally, with a maximum increase of 273% within 42 days, reaching a peak of 1.54. At that time, the overall market was in a frenzy, making it difficult to determine how much Grayscale's boost contributed to BAT's increase.
DEFG: Experienced a Brief Rebound
Launch Date: July 14, 2021 Assets Under Management: $3.34 million
DEFG is a basket trust fund launched by Grayscale specifically targeting the DeFi market, currently holding five tokens: UNI, MKR, AACE, LDO, and SNX, with UNI having the highest weight at 50%. This product was established on July 14, 2021, just before the market was set to rebound after a significant decline. Following the launch of DEFG, related DeFi tokens experienced a brief rebound, but the main driving force behind these rebounds likely came from the overall market rather than Grayscale's boost.
Grayscale Smart Contract Platform Ex-Ethereum Fund: Rebounded During Consolidation
Launch Date: March 16, 2022 Assets Under Management: $3.14 million
Grayscale Smart Contract Platform Ex-Ethereum Fund only invests in native tokens of emerging smart contract platforms, currently holding SOL, ADA, AVAX, and DOT, with SOL accounting for 71.54%. From the launch date, March 2022 was the first consolidation phase after the market decline, and after Grayscale launched this trust, the market experienced a one-month rebound.
STX: Continued Downtrend with Brief Rebound
Launch Date: May 22, 2024 Assets Under Management: $2.21 million
STX's price trend over the past six months has mainly been downward, and even after Grayscale launched the corresponding cryptocurrency trust, it only experienced a brief rebound before continuing to decline.
NEAR: Market Seems Unresponsive to Grayscale's Trust
Launch Date: May 22, 2024 Assets Under Management: $1.96 million
Grayscale launched both NEAR and STX trust products at the same time, but the cryptocurrency market seems to have lost enthusiasm for this, as NEAR's price began to decline after a brief 11% rebound.
TAO: Market Not Buying In
Launch Date: June 10, 2024 Assets Under Management: $1.5 million
TAO is one of Grayscale's latest cryptocurrency trusts, but the market seems to have reacted little to TAO. The overall trend has remained in its original direction.
Grayscale Decentralized AI Fund: Benefited from AI Hype with a Rebound
Launch Date: July 2, 2024 Assets Under Management: $1.09 million
Grayscale Decentralized AI Fund is one of the first trust funds that only invests in native tokens of decentralized AI protocols. Currently, it holds five tokens: FIL, NEAR, RNDR, LPT, and TAO, with FIL accounting for the highest proportion at 33% and NEAR at 30%. This product was launched on July 2, 2024, and after its launch, tokens like FIL and NEAR experienced a rebound, with FIL rebounding by 47%, NEAR by 61%, and LPT by 55%.
SUI: Multiple Positive Factors Stimulated Short-Term Surge
Launch Date: August 1, 2024 Assets Under Management: $630,000
SUI's price trend saw a strong rebound in August, with an increase of over 141% within a week after Grayscale announced the launch of the trust product. However, there are many reasons why the market is optimistic about SUI, and Grayscale's trust is just one of them, making it difficult to consider it the main cause. (Related Reading: SUI Increased 141% in a Week, Called the "Solana Killer," Is the Bullish Stance Justified?)
MKR: Experienced a Brief Rebound
Launch Date: August 8, 2024 Assets Under Management: $250,000
After the launch of MakerDAO's trust product, the market experienced a rebound at a low point, with MKR also seeing a 14% increase on the same day. However, it does not seem to have entered an independent market trend.
Does Grayscale Always Launch at the "End of the Bull Market"?
Grayscale's most significant impact on the cryptocurrency space occurred during the bull market between 2020 and 2021, when it significantly increased the asset scale of its Bitcoin trust, bringing in a large number of institutional investors into the cryptocurrency space. Other tokens have shown varied performance when Grayscale launched trust products; for instance, star tokens like FIL and MANA saw the most significant price increases after Grayscale launched their trust products, as they were leading projects in their respective sectors. In contrast, older tokens with larger market capitalizations, such as LTC, ETC, and BCH, did not experience much impact.
Moreover, Grayscale's launches of cryptocurrency trust products have been concentrated in the years 2018, 2021, and 2024. Comparing this with the overall market, it appears that Grayscale's concentrated launches often coincide with the peaks of bull markets or the latter half of bull markets. In 2018, launches were concentrated from February to August, just as the market transitioned from bull to bear, experiencing significant declines. In 2021, launches were concentrated from February to July, during a period of high-level consolidation and decline, but began to rise again in August, creating new highs. However, the reason for this phenomenon does not seem to be due to Grayscale's misjudgment of the market; rather, it is likely that Grayscale needs to confirm a token's market heat and maturity before launching related trust products, which is why the launches coincide with the end of bull markets.
The period from May to August 2024 is again a time when Grayscale is concentrating on launching cryptocurrency trusts. It remains to be seen whether this wave of Grayscale cryptocurrency trusts can break the previous "end of the bull market" cycle.
