DRW discloses nearly $200 million worth of crypto ETF holdings, led by ETHE

Finance firms • August 13, 2024, 5:11PM EDT

Published 1 minute earlier on

UPDATED: August 13, 2024, 9:23PM EDT

Quick Take

DRW disclosed it holds over $195 million worth of spot BTC and ETH exchange-traded funds, weighted primarily towards a $150 million investment in the Grayscale Ethereum Trust.
DRW’s entry into the ETH ETF market may signal a growing institutional appetite for ETH ETFs, which have seen comparably less interest post-launch than bitcoin funds.

Correction (9:22 p.m. ET): A previous version of this story originally attributed the holdings to DRW Venture Capital. The headline and article have been updated.

Chicago-based high-frequency trading firm DRW Holdings disclosed it now holds at least over $195 million worth of crypto exchange-traded funds, including over $150 million in the Grayscale Ethereum Trust, representing what is likely its first time taking exposure to ETH -0.67% , according to its latest Form 13F filing with the U.S. Securities and Exchange Commission.

The SEC approved the first traunch of spot ether ETFs to begin trading in July, approximately six months after spot bitcoin ETFs went live. And while spot bitcoin ETFs have earned billions of dollars in net inflows — due to a mix of institutions and retail traders — Ethereum-based funds have yet to garner as much interest.

DRW’s entry into the ETH ETF market may signal a growing institutional appetite for the second-largest cryptocurrency by market capitalization. The firm holds over three times the amount of ETH ETFs than BTC -0.35% ETFs — in fact, the Grayscale ETHE vehicle represents its third largest holding, following a fund tracking the S&P 500 and gold trust.

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The firm’s exposure to BTC ETFs is also less concentrated among any particular fund. It’s holding bitcoin products issued by Ark and 21Shares, Bitwise, BlackRock, Fidelity and Proshares, the latter of which is its largest bitcoin-centric holding.

DRW has become increasingly involved in the cryptocurrency industry since at least 2018. Its crypto-focused market-making unit Cumberland, for instance, has been tapped as a liquidity provider for a number of bitcoin ETFs. Cumberland also recently won approval for a “BitLicense” from the New York State Department of Financial Services.

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About Author

Daniel Kuhn is a Senior Journalist and Editor at The Block, where he covers the crypto industry with a particular focus on tech. He previously served as deputy managing editor of opinion/features at CoinDesk. He first appeared in print in Financial Planning, a trade publication magazine. Before journalism, he studied philosophy as an undergrad, English literature in graduate school and business and economic reporting at an NYU professional program. You can connect with him on Twitter and Telegram @danielgkuhn or find him on Urbit as ~dorrys-lonreb.