(Bloomberg) — Digital-asset manager Grayscale Investments is now the crown jewel of Barry Silbert’s once-$10 billion Digital Currency Group conglomerate, in the eyes of Ark Investment Management’s Cathie Wood.
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“We know that the Grayscale Investment trusts are the most valuable part of that company right now, and they’re cash cows,” Wood said in a Bloomberg Television and Radio interview on Tuesday. “We think they’re going to try and hold onto that if nothing else.”
The comments from Ark’s chief executive come as beleaguered cryptocurrency brokerage Genesis searches for fresh capital to stave off a potential bankruptcy after halting withdrawals last week in the wake of FTX’s stunning collapse. Genesis’s ordeal has thrown the health of parent company DCG into question and it’s clear that Grayscale is the sturdiest part of the business, Wood said.
Wood has been a buyer of Grayscale Bitcoin Trust, known as GBTC, even as the trust sinks to a record discount relative to its underlying Bitcoin. The ARK Next Generation Internet exchange-traded fund (ticker ARKW) has purchased GBTC shares three separate times already this month for the first time since July 2021. While the discount has punished long-term holders of the trust, the gap should narrow over time and there’s “a lot of upside,” Wood said.
Roughly $10 billion sits in GBTC, and Bloomberg Intelligence estimates that the trust holds more than 3% of all mined Bitcoin. Last…
