Grayscale and CoinDesk Partner to Launch New DeFi Fund and Index
Grayscale Investments, a leading digital currency asset manager with, and CoinDesk Indexes, a benchmarking and subsidiary of Coindesk Inc., have announced a partnership that will see the launch of Grayscale Decentralized Finance (DeFi) Fund and the CoinDesk DeFi Index.
The partnership will welcome Grayscale’s new investment product working in collaboration with the CoinDesk DeFi Index, a newly-designed benchmarking, portfolio tracking, and market reference platform that will represent DeFi protocols with liquid assets on a market capitalization-weighted basis. Grayscale’s DeFi Fund will provide investors with exposure to protocols listed on the CoinDesk DeFi Index.
“Grayscale continues to focus on creating opportunities for investors to access new, exciting parts of the digital asset ecosystem,” shares Grayscale Investments CEO Michael Sonnenshein.
The new investment product from Grayscale follows its recent forays into expanding its positions across both traditional and crypto-based assets, being its fifteenth investment product along its suite, as well as its second diversified fund under its portfolio of offerings.
“The emergence of decentralized finance protocols provide clear examples of technologies that can redefine the future of the financial services industry. We’re proud to offer investors exposure to DeFi through Grayscale’s trusted, secure, and industry-leading investment product structures,” Sonnenshein added.
Evaluations on the CoinDesk DeFi Index (DFX) will be based on existing methodologies implemented at TradeBlock, another subsidiary of CoinDesk Inc., which follows a rules-based index methodology maintained across a set of cryptocurrencies weighted according to market capitalization with quarterly reviews amended based on changes in value and token supply.
With increasing attention on the innovations within decentralized finance, it’s critical for the investment community to have tools that deliver calculated exposure to this exciting area of innovation. This collaboration offers investors the data and tools they need to gain exposure to decentralized finance into their portfolios.” shares Jodie Gunzberg, Managing Director of CoinDesk Indexes.
According to the two firm’s official press release on the matter, CoinDesk’s DFX consists of the following assets with varying weight:
- Uniswap (UNI), 49.95%
- Aave (AAVE), 10.25%
- Compound (COMP), 8.38%
- Curve (CRV), 7.44%
- MakerDAO (MKR), 6.49%
- SushiSwap (SUSHI), 4.83%
- Synthetix (SNX), 4.43%
- Yearn Finance (YFI), 3.31%
- UMA Protocol (UMA), 2.93%
- Bancor Network Token (BNT), 2.00%
While the new DeFi fund has been opened for subscriptions to eligible individuals and accredited institutional investors, Grayscale says that it intends to push shares of the new product for quotations on a secondary market. According to Grayscale, interested investors and shareholders must be cautious of external factors that may affect the risks associated with the new investment product, citing concerns on how regulatory bodies such as the SEC and FINRA, among others, may perceive the product, with forthcoming regulatory frameworks for implementation that may further open the product to more risk over time.