Crypto asset manager Grayscale is launching a new product focused on income from staking rewards.
In a new announcement, Grayscale says that it is launching the Grayscale Dynamic Income Fund (GDIF), a new actively managed investment product that aims to earn profits from the staking rewards of proof-of-stake (PoS) crypto assets.
“GDIF is our first actively managed investment product. It seeks to optimize income in the form of staking rewards associated with proof-of-stake digital assets.”
According to Grayscale’s website, the GDIF works by investing customer funds into tokens of PoS blockchains that earn rewards. They would then be cashed out and distributed accordingly. Grayscale also says it would rebalance the fund’s holdings as needed to optimize income.
Staked tokens are coins that are used to validate a blockchain’s network transactions and are vital to the infrastructure of a PoS blockchain. Staking requires validators to devote tokens to the network, and in return, they earn rewards.
Grayscale says the GDIF, which was announced earlier this month, will take those rewards, which are paid out in the blockchain’s native asset, and convert them to US dollars.
“In return for securing the network through the validation of transactions, investors earn staking rewards. Staking rewards are paid in each blockchain’s native token. For GDIF, staking rewards aim to be converted to USD weekly and aim to be paid quarterly to investors.”
The GDIF marks another offering in Grayscale’s expanding suite of institutional-scale crypto products.
In January, the firm added a Bitcoin (BTC) exchange-traded fund (ETF) after a years-long battle with the U.S. Securities and Exchange Commission (SEC) and is now looking to include a mini BTC Trust and an ETF centered around smart contract platform Ethereum (ETH).
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