- Institutional asset managers are exploring diverse crypto ETFs, including Polkadot, with 21Shares recently registering a Polkadot Trust in Delaware following its launch of a Polkadot ETP on the SIX Swiss Exchange in 2021.
- The move sparked a debate on whether Polkadot will struggle against competitors like Solana and XRP.
This week, 21Shares registered its Polkadot Trust in Delaware, in an attempt to provide accredited investors with exposure to Polkadot’s smart contract ecosystem.
The asset manager launched the first Polkadot exchange-traded product (ETP) in Europe in 2021, listing it on the SIX Swiss Exchange.
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But Polkadot’s performance is less impressive, so to speak, than competitors like Solana and XRP, so it’s quite difficult to see immediate demand for such an investment product.
Grayscale also registered a Trust in 2021 that included Polkadot as part of Grayscale’s broader Smart Contract Platform Ex-Ethereum Fund. The fund holds other assets like Solana (SOL), Cardano (ADA), Avalanche (AVAX) and NEAR Protocol (NEAR).
The fund, which has a modest US$5.28 million (AU$8.47 million) in assets under management (AUM), allocates a 6.97% weighting to DOT.
At the end of the day, if XRP and Solana have it rough for a potential ETF approval (or even a revision), what’s left for the rest of the market? The US Securities and Exchange Commission (SEC) has classified these assets as securities in ongoing lawsuits, further complicating their path to ETF approval.
Meanwhile…
Bitcoin ETFs in the US have seen remarkable success, with year-to-date inflows reaching US$37 billion (AU$59.4 billion) since January. This demand included 15 consecutive days of inflows between late November and mid-December, according to SoSo Value.
Bloomberg ETF expert Eric Balchunas noted that BlackRock’s iShares Bitcoin Trust (IBIT) achieved the fastest growth to US$50 billion (AU$80.2 billion) among ETFs in history.
What about Ethereum? Well, it’s no surprise that it’s nowhere near as successful as Bitcoin ETFs in inflows, but analyst Nate Geraci expects these to accelerate soon, stating that Ethereum ETFs are “on pace” with gold.
Related: Michael Saylor Open to Advising Trump Administration on Crypto Strategy
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