Grayscale, a digital asset management and investment firm with $53.5 billion Asset Under Management (AUM) as of the time of this writing, has launched a Solana Trust which will be the firm’s 16th product in its collection of investment offerings.
The announcement explains that the trust is solely and passively invested in SOL, the native token of the Solana network. The Solana blockchain touts to be one of the fastest blockchains in the wars between smart contracts, being able to execute 59,000 transactions per second.
The announcement said, “The Trust is solely and passively invested in Solana (SOL), the native token of the Solana network, a smart contract platform first conceived in a 2017 whitepaper. Like the Ethereum network, the Solana network is one of a number of projects intended to expand blockchain use beyond just a peer-to-peer money system. The Solana protocol introduced the Proof-of-History (PoH) consensus mechanism as an alternative to pure Proof-of-Stake (PoS) and Proof-of-Work (PoW) blockchains.”
What you should know
Solana has had an astronomical rally over the past few months, pushing its native token into the top 5 cryptocurrencies by market capitalization. Year-to-Date, according to TradingView, the token has rallied over 11,650%.
Grayscale’s decision to add Solana into its service portfolio will make SOL more visible across more high-net-worth and institutional investors. This is primarily because of Solana’s incredible growth as a blockchain project in 2021.
The layer-one protocol emerged as a rival to fellow smart contracts platform Ethereum after providing users with one of the lowest-costing and fastest public ledgers. In both transaction speed and cost, it put performs Ethereum and all other blockchains existing.
Solana’s ecosystem attracted over 500 projects spread across decentralized finance (DeFi), nonfungible tokens (NFT), Web 3.0, and other sectors, with 1.2 million active users on the network. Among them is Serum, a decentralized derivatives exchange backed by billionaire Sam Bankman-Fried’s FTX and Alamada Research.
The statement comes after Coinshares, a London-based asset management firm, reported net capital inflows worth over $250 million into the SOL-based exchange-traded products (ETP). In a Coinshares report, this month alone, the Solana ETPs attracted around $42.2 million.
Grayscale CEO, Michael Sonnenshein stated, “For the last eight years, Grayscale has been at the forefront of offering investors efficient exposure to the ever-evolving digital currency ecosystem. We have had a front row seat to the mainstream acceptance and adoption of crypto, and increasingly find that investors are diversifying their exposure beyond digital assets like Bitcoin and Ethereum. Our family of Grayscale products will continue to expand alongside this exciting asset class, as we remain committed to offering investors opportunities to access the digital economy.”
The announcement also stated that the Trust is now open for daily subscription by eligible individual and institutional accredited investors. The Trust functions the same as Grayscale’s other single-asset investment trusts. SOL trades $216.45, up 6.56% for the day, as of the time of this writing.