Global investment and financial advisory services company Guggenheim Partners is getting ready to funnel as much as half a billion dollars into Bitcoin.
According to a document filed by Guggenheim Funds Trust at the US Securities and Exchange Commission (SEC) on November 27th, the Wall Street giant with $295 billion assets under management is seeking approval for one of its funds to take a substantial position in the Grayscale Bitcoin Trust (GBTC).
“The Guggenheim Macro Opportunities Fund may seek investment exposure to Bitcoin indirectly through investing up to 10% of its net asset value in Grayscale Bitcoin Trust. To the extent the Fund invests in GBTC, it will do so through the Subsidiary. Except for its investment in GBTC, the Fund will not invest, directly or indirectly, in cryptocurrencies.”
With $5.3 billion in total assets under management according to investment research firm Morningstar, the Guggenheim Macro Opportunities Fund is expected to purchase more than $500 million in GBTC, joining the ranks of large institutional investors, including MicroStrategy and Square, who have taken a leap of faith into Bitcoin this year.
In its SEC filing, Guggenheim highlights that cryptocurrencies have unique features designed to facilitate decentralized, peer-to-peer (P2P) transactions without oversight by central banks and regulatory authorities. However, the firm points out that Bitcoin’s price can be highly volatile and result in huge losses for the company.
“The price of Bitcoin could drop precipitously (including to zero) for a variety of reasons, including, but not limited to, regulatory changes, a crisis of confidence in the Bitcoin network or a change in user preference to competing cryptocurrencies. The Fund’s exposure to cryptocurrency can result in substantial losses to the Fund.”
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