Grayscale's Dave LaValle Hints At More Digital Asset-Backed ETFs To Come

With the recent appearance and subsequent disappearance of the BlackRock spot Bitcoin BTC/USD ETF ticker on the Depository Trust & Clearing Corporation's (DTCC) listings, a Bitcoin Fund is looking inevitable.

Dave LaValle, the global head of ETFs for Grayscale Investments, which claims to be the world's largest crypto asset manager, spoke with Benzinga about the firm's plans for a future with greater optionality for investors through ETFs based on digital assets.

"I believe we are coming out of this crypto winter," LaValle said.

Although the crypto bear market has been a setback for the blockchain space, it hasn't raised questions of the viability of digital assets so much as questions of timing, he explained.

"People have seen it as more a question of 'when is the right time to get back in?'" he said. "In previous crypto winters, the prevailing attitude was 'this is not a viable asset class.'"

The questions now are: "Where do digital assets actually fit into my portfolio? How should I think about making an allocation? And where should that allocation be funded from?"

Grayscale will be speaking at Benzinga's Future of Digital Assets conference on Nov. 14. This event will discuss the future of digital asset-backed ETFs and their impact on mainstreaming crypto.

Exposure To The Digital Asset Market

LaValle reinforced that Grayscale is focused on optionality, access, transparency, and fairness for all levels of retail and institutional investors.

"We're bringing exposure to the digital asset market in the most efficient way that can be managed by financial advisors and investors with the greatest level of transparency and confidence," he said. "The exchange-traded fund has been battle-tested for the past 30 years. It's done an excellent job of offering the widest range of exposures to investors of all shapes and sizes, with the same investor experience."

This equity of experience has a real financial impact for investors because the added option of ETFs evens out tax burden and fees and opens up new markets for investors, he explained.

"If I want to buy SPY, GLD, and Bitcoin ETF, I will have a consistent experience, sending an order to a stock exchange, getting an execution, paying the same management fee, and having the same tax treatment," he said. "It's about fairness and transparency. A lot of what preceded exchange-traded funds has not been equitable, whether you want to talk about multiple share classes in exchange in mutual funds, or just the reality that certain exposures are not accessible to many investors."

LaValle has seen first-hand the evolution and adoption of ETFs and regards opening the path to a spot Bitcoin ETF as a victory for the ETF wrapper, not just a success for Bitcoin.

"In the 2010-2012 timeframe, the ETF wrapper was still being called into question as maybe the next financial weapon of mass destruction. Now, the conversation is only about the Bitcoin that will be inside the wrapper, and no one is challenging the credibility or the merit of the ETF wrapper in itself. It will allow people to invest in a new asset class that we have tremendous conviction about, with a high level of credibility and competence. That's why I get excited about it."

When asked for insights into the next steps for Grayrock ETFs, LaValle was bullish on the idea and understandably mum on details beyond the public filings.

"We're laser-focused on GBTC right now and the conversion. We have some public filings in accordance with our series trust for approximately 40 more products that we're considering bringing to market. We 1,000% aspire to create other ETFs based on digital assets, just like the GBTC conversion. We intend to do that with all of our, all of our digital asset products."

Spot Bitcoin ETF

When Bitcoin's prices rose to over $35,000, it indicated investor interest in an ETF but dropped 3% when the listing was removed.

Grayscale is another major contender for a spot BTC ETF and is prepared for a future with many digital asset-backed ETFs. The firm announced the formation of Grayscale Funds Trust, a Delaware statutory trust structure that allows Grayscale to independently manage its ETF products as the firm continues to build out its ETF franchise.

Grayscale CEO Michael Sonnenshein commented, "We are putting the necessary foundations in place so Grayscale can continue creating and managing regulated, future-forward products."

Grayscale also filed a Registration Statement with the Securities & Exchange Commission (SEC) for three other funds: Grayscale Ethereum Futures ETF, Grayscale Global Bitcoin Composite ETF, and Grayscale Privacy ETF, all part of a series under Grayscale Funds Trust.

Meet and engage with transformative Digital Asset and Crypto business leaders and investors at Benzinga's exclusive event: Future of Digital Assets. Tickets are flying: Get yours!