Original | Odaily Planet Daily ( @OdailyChina )
Author | Vincent31515173 ( @vincent31515173 )
Last night, Grayscale announced the launch of the AVAX trust fund Grayscale Avalanche Trust, providing qualified investors with the opportunity to invest in the cryptocurrency AVAX. As soon as this news came out, AVAX surged, with an increase of over 5% within 1 hour; as of the time of writing today, the 24-hour increase exceeded 10%, currently at 25.7 USDT.
In fact, in the past half month, AVAX has stabilized at the bottom and started to rebound. Its price has risen from a near 9-month low of 17.29 USDT on August 5th to a high of 26.6 USDT, with a two-week increase of over 45%.
In addition to the stimulus from Grayscale AVAX Trust, global asset management company Franklin Templeton also announced the expansion of its Franklin Onchain US Government Money Fund to the Avalanche network, coupled with the significant reduction in the unlocking events of AVAX tokens after this year. With the support of multiple positive factors, AVAX's price has been able to rise as it has.
Odaily Planet Daily found that this year, Grayscale has frequently launched trust funds for different sectors or tokens, and the related tokens have achieved good performance in a short period of time. When Grayscale launches a new fund, can it be a new barometer for retail investors' investment?
Grayscale's New Launch: A Barometer for the Altcoin Market
From the beginning of the year to the present, Grayscale has frequently launched new cryptocurrency trust funds, including new trusts for SUI and TAO, decentralized artificial intelligence funds, and more, which have attracted widespread attention in the cryptocurrency market. The launch of these new funds not only provides more investment choices for qualified investors, but also to a certain extent boosts the market performance of related cryptocurrencies.
For example, on August 7th, after Grayscale announced the launch of the Grayscale Sui Trust fund, SUI surpassed 0.64 USDT, with a daily increase of over 10%; on July 17th, after Grayscale launched the decentralized artificial intelligence fund (Grayscale Decentralized AI Fund LLC), which includes multiple decentralized AI projects such as Bittensor (TAO), Filecoin (FIL), Livepeer (LPT), Near (NEAR), and Render (RNDR), the above-mentioned tokens all saw an increase of over 10% in a short period of time.
Through its cryptocurrency trust funds, Grayscale has brought a significant "confidence effect" to the altcoin market. Whenever Grayscale launches a new fund, investors often believe that the cryptocurrencies covered by these funds have high investment value, thereby driving up their prices. This phenomenon indicates that Grayscale plays an important role as a barometer in the altcoin market, especially when market sentiment fluctuates significantly, the direction of Grayscale's layout often guides the focus of market investment.
Why can Grayscale's cryptocurrency trust funds attract qualified investors? The reason is that Grayscale provides a bridge between the traditional financial market and the cryptocurrency market, allowing investors to access emerging crypto assets through familiar financial tools. In addition, Grayscale's trust funds are usually regulated, providing investors with a relatively safe and compliant investment channel.
On the other hand, the special mechanism of Grayscale's trust funds also provides arbitrage opportunities for investors. Grayscale's "naked long trust" mechanism allows investors to subscribe to cryptocurrency trust shares through private placements in the primary market, and then sell them on the secondary market after the unlocking period, using the premium between the primary and secondary markets for arbitrage. For example, trust funds such as LTC, BCH, and SOL often show a high premium in the US stock secondary market, providing investors with significant arbitrage opportunities.
Specifically, investors can subscribe to cryptocurrency trust shares through private placements in the primary market, unlock these shares after the lock-up period, and sell them on the secondary market. Due to the high market premium of Grayscale's trust funds, investors can obtain significant returns through this method. In addition, Grayscale's trust funds are essentially "naked long trusts," meaning that these trust funds can only be bought and not sold in the short term, which further increases the market premium and enhances the possibility of arbitrage.
In summary, the launch of new funds by Grayscale provides institutions and traditional financial investors with a channel to participate in the crypto market, and also provides certain arbitrage opportunities, allowing most traditional investors to obtain relatively stable investment returns, thereby enabling Grayscale to steadily earn management fees, which is beneficial for both parties.
Conclusion
As Grayscale continues to launch new cryptocurrency trust funds, the market increasingly sees it as an investment barometer, guiding the direction of market investment to some extent. Whenever it launches a new fund, the market usually believes that the cryptocurrencies covered by these funds have high potential and investment value. The launch of the AVAX trust fund and the subsequent price increase are typical manifestations of this barometer effect.
However, when following Grayscale's layout, investors still need to be cautious and avoid blindly following the trend. Although Grayscale's trust funds can significantly influence market sentiment and create arbitrage opportunities, the fundamentals of the related cryptocurrencies may not necessarily have been substantially improved.
As one of the world's largest cryptocurrency asset management companies, every move by Grayscale may have a profound impact on the market. Therefore, investors should consider Grayscale's new funds as an important reference indicator, and make wise investment decisions based on the overall market performance and their own risk tolerance.
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