Grayscale Launches Bitcoin Mining Investment Vehicle

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(Kitco News) – Grayscale, the world’s largest cryptocurrency asset manager, has revealed the launch of a new investment product designed to give investors exposure to Bitcoin mining hardware.

Grayscale Digital Infrastructure Opportunities LLC (“GDIO”) is a private co-investment opportunity that is “designed to capture (the) bright side of the crypto winter,” Grayscale said.

According to the announcement, Grayscale will leverage the operational expertise of Foundry – its digital asset mining, staking and infrastructure affiliate – to manage day-to-day operations of GDIO in a unique product suite. kind offered by the asset manager.

“Grayscale’s unique position at the center of the crypto ecosystem allows us to create offerings that allow investors to grow capital through different market cycles,” said Michael Sonnenshein, CEO of Grayscale. “Our team has a long-standing commitment to lowering the barriers to investing in the crypto ecosystem – from direct exposure to digital assets, to diverse themed products, and now infrastructure via GDIO.”

Qualified individual and institutional qualified investors can now start investing in GDIO, which is considered a going concern and not a registered investment company under the Investment Companies Act. This means that investors do not benefit from the regulatory protections provided to investors in investment companies.

Funds invested in the new product will be used to purchase mining equipment, according to Rayhaneh Sharif-Askary, head of investor relations at Grayscale, who expects to see many low-cost mining machines put up for sale in the coming months amid the current crisis. crypto winter.

“In the coming months, we expect some miners to be forced to liquidate their mining equipment,” Sharif-Askary said. “GDIO is positioned to provide liquidity to these miners, buying mining hardware at pittance prices and mining profitably as the price of Bitcoin recovers.”

Once the new equipment is acquired, it will be deployed to “mine bitcoin, sell bitcoin daily, and distribute the generated cash to investors, generating revenue,” Sharif-Askary added. “While many people have exposure to cryptocurrencies themselves, it is much more difficult for the everyday investor to source, store and operate mining equipment to generate a profit by mining Bitcoin. ”

Foundry, which operates one of the largest mining pools in the world, Foundry USA, will manage the day-to-day operations of the GDIO. Foundry and Grayscale are subsidiaries of the Digital Currency Group (DCG).

Grayscale changes things internally

This announcement follows news earlier this week that Grayscale Investments has terminated two deals with cryptocurrency broker Genesis around its Grayscale Bitcoin Trust.

According to the SEC depositGenesis will no longer assist Grayscale in the distribution and marketing of its shares and will no longer be an authorized participant of the trust, but will continue to serve as a liquidity provider for Grayscale.

Grayscale Securities LLC, a wholly owned subsidiary of Grayscale Investments LLC and a subsidiary of Grayscale Bitcoin Trust, will now manage responsibilities previously assumed by Genesis.

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