John Hoffman, Head of Distribution and Partnerships at Grayscale Investments, joined Keith Black, Managing Director of RIA Channel, to discuss how bitcoin and ETFs are our generation’s two most important financial innovations.
Operating for over a decade, Grayscale is the world’s largest crypto-focused investment management firm. The firm seeks to make it easy for investors to access crypto in regulated product structures, with product offerings in bitcoin, Ethereum, and other crypto assets.
The Grayscale Bitcoin Trust (GBTC) was launched as an over-the-counter vehicle in 2013. Changes in regulatory structures in 2023 led to the conversion of GBTC into an ETF in January 2024 and set the stage for other firms to launch spot bitcoin ETFs. In just four months, the US-listed spot bitcoin ETFs reached $60 billion in AUM, the most successful ETF launch ever.
Crypto may be able to add value to a portfolio, as it has historically offered a low correlation of returns to investments in stocks, bonds, and real estate. In addition to correlation benefits, crypto assets have also offered high historical returns. GBTC returned nearly 50,000% since its 2013 inception. Due to high levels of volatility and historical returns, it is important for investors to rebalance the crypto assets held in their portfolios. Advisors can interact with Grayscale to get their questions answered in person or access online research reports and educational resources.
Hoffman states that 52 million Americans own crypto today, but the technology is still early in its global adoption. Blockchain is a global technology that will change how the world lives, works, and plays. As adoption grows toward 1 billion global investors, network effects can accelerate the value for investors.
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