Grayscale Adds Cardano to Its Digital Large Cap Fund as Third Biggest Component

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Grayscale Investments, the world's largest digital currency asset manager with more than $30.4B in assets under management as of July 1, 2021, announced that Cardano, a proof-of-stake blockchain platform created by Charles Hoskinson, a co-founder of Ethereum, has been added to its large-cap cryptocurrency fund Digital Large Cap Fund. Cardano is now the third-largest component of the fund after bitcoin and ether.

According to Grayscale Investments, Grayscale Digital Large Cap Fund enables investors to gain exposure to a market-cap weighted portfolio of large-cap digital currencies through a singular investment vehicle without the challenges of buying, storing, and safekeeping digital currencies directly. Through a rules-based portfolio construction methodology, the Fund targets coverage of the upper 70% of the digital currency market and is re-evaluated each quarter. In accordance with the Fund's construction criteria, Grayscale has adjusted the Fund’s portfolio by selling certain amounts of the existing Fund Components in proportion to their respective weightings and using the cash proceeds to purchase Cardano (ADA). ADA is the native token of the Cardano network that allows holders to engage in peer-to-peer transactions and stake as collateral to contribute to the network's consensus mechanism. 

"We are excited to welcome Cardano to our Digital Large Cap Fund's portfolio as we work to ensure that our diversified Fund can safely hold assets that collectively comprise 70% of the entire digital asset market," said Edward McGee, Vice President of Finance at Grayscale. "Digital currencies represent a unique opportunity for investors to diversify their portfolios, and at Grayscale, we are proud to provide our investors with access to leading digital currencies through regulated, familiar product offerings."

At the end of the day on July 1, 2021, the Fund Components were a basket of 67.47% Bitcoin (BTC), 25.39% Ethereum (ETH), 4.26% Cardano (ADA), 1.03% Bitcoin Cash (BCH), 0.99% Litecoin (LTC), and 0.86% Chainlink (LINK). The Fund does not generate any income and regularly distributes Fund Components to pay for its ongoing expenses. Therefore, the amount of Fund Components represented by each Share gradually decreases over time.