Crypto Asset Manager Grayscale Adds $905 Million in Record Quarter

Multi-billion dollar cryptocurrency asset manager Grayscale Investment has reported its largest quarterly inflows to date, as in Q2 2020 it brought in $905.8 million, nearly doubling its previous record high of $503.7 million in the first quarter of the year.

The cryptocurrency-focused investment firm revealed the record inflows in its latest report, which noted that in the first half of this year it raised a total of $1.4 billion. The document reads:

For the first time, inflows into Grayscale products over a 6-month period crossed the $1 billion threshold, demonstrating sustained demand for digital asset exposure despite a backdrop characterized by economic uncertainty.

Grayscale’s products offer investors exposure to cryptoassets without them having to manage any crypto wallets or private keys. Its Grayscale Bitcoin Trust (GBTC) and Grayscale Ethereum Trust (ETHE), which provide investors exposure to BTC and ETH respectively, recorded quarterly inflows of $751.1 million and $135.2 million respectively.

According to Grayscale, the inflows to its GBTc products exceeded the supply of newly mined bitcoin entering the market over the same period, as the May bitcoin halving event saw block rewards drop to 6.25 BTC per block, from 12.5 BTC. Per Grayscale, this “may be a positive sign for Bitcoin price appreciation.”

The firm added that new investors accounted for $124.1 million of inflows and made up 57% of the investor base. 81% of returning institutional investors allocated their funds to multiple products, which means institutions are now diversifying into altcoins.

Grayscale’s Ethereum Trust, it adds, accounted for nearly 15% of the total inflows, its highest percentage to date, while its Ethereum Classic Trust and Digital Large Cap Fund combined exceeded $50 million of inflows over the past 12 months. The Litecoin Trust saw its largest inflows to date, while the Bitcoin Cash Trust saw its largest inflow since the second quarter of 2018.

As CryptoGlobe reported, growing institutional interest in bitcoin and ether have helped Grayscale’s assets under management surpass $4 billion last month.

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