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Investing App Wealthfront to Offer Grayscale’s Bitcoin, Ethereum Products

DATE POSTED:July 30, 2021

As more investors turn to cryptocurrencies, Wealthfront, a Palo Alto-based firm with $25 billion in assets under management (AUM), has expanded its clients’ investment options to include Grayscale Bitcoin Trust (GBTC) and Grayscale Ethereum Trust (ETHE).

Wealthfront’s new offering will also include automation features like “intelligent dividend reinvestment” and tax-loss harvesting–a feature aimed at lowering clients’ tax bills.

In using GBTC and ETHE, investors won’t need to set up external wallets and take care of technical aspects such as safekeeping the private keys. All of Grayscale’s crypto products are merely meant to track the price action of the underlying asset.

GBTC is the oldest and largest cryptocurrency fund run by New York-based firm Grayscale Investment. Commanding $25.9 billion in AUM, it offers SEC-regulated exposure to Bitcoin, tracking the price of the benchmark cryptocurrency.

Launched in 2017, ETHE is the first publicly-quoted Ethereum investment vehicle in the U.S. and Grayscale’s second-largest crypto fund with $7.3 billion in AUM. The company runs several other crypto funds tracking the price of coins like Litecoin, Bitcoin Cash, Basic Attention Token, and Zcash, among others.

07/29/21 UPDATE: Net Assets Under Management, Holdings per Share, and Market Price per Share for our Investment Products.

Total AUM: $34.7 billion$BTC $BAT $BCH $LINK $MANA $ETH $ETC $FIL $ZEN $LTC $LPT $XLM $ZEC $UNI $AAVE $COMP $CRV $MKR $SUSHI $SNX $YFI $UMA $BNT $ADA pic.twitter.com/5R63gk6ABj

— Grayscale (@Grayscale) July 29, 2021

Wealthfront nonetheless warns that crypto investments can be riskier and more volatile than most exchange-traded funds (ETFs), and that’s why the firm has capped clients’ allocation to GBTC and ETH to 10% of the entire portfolio.

The company’s other investment options available include a selection of ETFs managed by Cathie Wood’s ARK Invest, as well as ETFs “that are specific to industries like cannabis or self-driving cars.”

Wealthfront is the latest financial institution to offer its clients access to Grayscale’s Bitcoin and Ethereum products.

Last week it was reported that banking giant JP Morgan took a similar action, also adding Grayscales’s Bitcoin Cash and Ethereum Classic trusts to the list of available crypto investment options.