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On June 21, Digital Currency Group (DCG) announced that it would buy $50 million worth of Ethereum Classic shares issued by Grayscale (ETCG).
ETCG is a stock owned by Grayscale, a subsidiary of DCG. Holding ETCG is also equal to possessing Ethereum Classic (ETC).
“DCG has planned to purchase the above shares in cash and will conduct the transaction on the open market, at the discretion of the Board of Directors,” the firm said in a statement.
Grayscale is famous for its most prominent item, the Grayscale Bitcoin Trust (GBTC). This is a business that owns considerable amounts of Bitcoins and reissues them as stocks for trading on the public sector.
Bitcoin Trust and many other Grayscale products provide investors, including some large funds, a solution to trade cryptocurrencies when they aren’t qualified for direct purchase.
Howeverthis statement by DCG hasn’t been able to bring some positive signs for Ethereum Classic as the cryptocurrency has dropped over 10 percent on June 21. This also saw a substantial drop in the whole cryptocurrency market. Currently, ETC is trading around $40.
The decision to purchase shares of this Ethereum Classic finance was created by DCG after the firm revealed in ancient May that it would spend $750 million to buy shares of the Grayscale Bitcoin Fund.
This move is seen by many as DCG’s move to increase the purchase price of GBTC amid rumors that the SEC may approve a Bitcoin ETF. This is anticipated to significantly alter the requirement for Grayscale’s GTBC solutions.
According to Grayscale’s business model, the business will offer access to crypto trust products to accredited investors. They will also charge a 2% management fee in the procedure. Investors can then sell the shares to the public when the 6-12 month lockup period ends.
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