Grayscale, a prominent player in digital asset management, has unveiled its latest offering—the Grayscale Aave Trust—aimed at giving qualified investors exposure to the DeFi lending protocol's governance token, AAVE.
This marks a continuation of Grayscale’s push to diversify its investment options, with recent launches of trusts for Avalanche (AVAX) and XRP.
Aave, a top player in decentralized finance, allows users to borrow and lend cryptocurrency without intermediaries. This new fund further underscores Grayscale’s commitment to expanding access to decentralized financial products for institutional investors.
Grayscale Introduces AAVE Investment Trust
On October 3, 2024, Grayscale, a leading U.S. digital asset management firm, announced the launch of an investment trust for the cryptocurrency AAVE.
AAVE is the governance token for Aave, a DeFi lending protocol that allows users to borrow and lend cryptocurrency without the need for credit checks or identification, utilizing smart contracts.
The newly announced investment fund is called the Grayscale Aave Trust, and it will exclusively invest in AAVE. Grayscale stated that through this trust, investors will have direct exposure to AAVE.
However, this investment trust is limited to qualified investors. Most individual investors will not be eligible to participate. To qualify, an individual must have an annual income exceeding $200,000 or possess assets worth at least $1 million, creating a high entry barrier for many.
According to DeFiLlama, Aave's Total Value Locked (TVL) is approximately $11.8 billion, making it the largest lending protocol in the DeFi space. AAVE, as a governance token, can be used for protocol voting and offers perks such as fee discounts.
A Grayscale spokesperson commented in the press release, "Aave aims to optimize lending and borrowing by leveraging blockchain and smart contracts, removing intermediaries, and reducing reliance on human judgment."
Grayscale Expands Product Offerings
Grayscale has been accelerating its product expansion over the past few months. In August 2024, the firm introduced an investment trust for Avalanche (AVAX), followed by the announcement of support for XRP in September.
In addition to single-asset cryptocurrency investment trusts, Grayscale now manages 20 different funds. Moreover, in July, they launched basket-type products that bundle multiple cryptocurrencies across various sectors, including AI.
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