Grayscale Is Buying Ethereum Too: Will The ETH Price Rise?

New reports in the cryptonews from the major cryptocurrency fund manager Grayscale Investment show that around 22% of the purchases have been in ETH throughout 2020 so far. Grayscale is buying Ethereum and has totaled $110 million worth of accumulation.

Even though before this we reported how the fund is interested in Bitcoin – and highlighted the Grayscale Bitcoin Investment Trust (BIT) – the fund manager is apparently growing its Ether (ETH) stash as well.

The director of investor relations at Grayscale, Ray Sharif-Askary, spoke on a recent episode of the Coinscrum markets podcast. In it, he said that an enormous $110 million worth of ETH has been purchased by the fund in 2020. As such, Grayscale is buying both BTC and ETH and the purchases are now equal to 0.4% of the total market cap that Ether has in the past five months.

Sharif-Askary was also in the ETH news for noting that over 38% of the current clients that Grayscale has now hold more than one crypto asset. This number is up significantly from the 9% as of 12 months ago.

“It is encouraging to investors […] diversify within the digital currency asset class, just like they would with any other traditional asset class,” she noted.

In another comparison, we can see that Grayscale is buying crypto and has purchased $390 million in Bitcoin (BTC) which is approximately 0.2% of the total Bitcoin market cap. Rumors show that the firm is reportedly buying the BTC at a rate that is equal to 1.5 times the quantity of new Bitcoin created through mining.

What you also need to know besides that Grayscale is buying ETH and BTC is the fact that the accumulation of Ether has coincided with a dramatic year-to-date (YTD) performance for shares in the Grayscale Ethereum Trust. These have increased by nearly 800% with the market’s last recorded trade closing for $210.

Within the last 24 hours, the trust tested $250 and offered year-to-date (YTD) returns of 995% to investors who purchased shares at the start of January.

Meanwhile, Sharif-Askary also attributed the firm’s enormous crypto accumulation to institutions that are seeking a hedge fledge against inflation – as a response to the US monetary policy and the US dollar weakening because of the COVID-19 crisis. She said:

“From a border perspective, COVID-19 and the policy implications especially have really set the stage for Bitcoin to become seen as a store of value asset. […] Institutional investors are taking active long positions in digital assets through our products, and it’s because they are looking for an asset that is scarce and that can be used as an inflation hedge in a world where we are faced with unprecedented monetary stimulus. We’ve never seen demand like this before for our products.”

Earlier reports in our Ethereum news showed that the Grayscale ETH Trust managed to provide 679% year-to-date returns.