Grayscale, a leading cryptocurrency asset management firm, announced the distribution of Ethereum Proof of Work tokens to shareholders who possess ETHW and GDLC. The firm announced that its two investment funds had received rights to run the forked EthereumPoW tokens passively.
Grayscale’s Official Report
In a press release, the cryptocurrency investment fund announced earlier today (September 16, 2022) that it had published record dates for the distribution of the Ethereum Proof-of-Work tokens to stakeholders. Ethereum delegated the rights to the fund due to the folk achieved by the firm in the Ethereum blockchain on September 15, 2022 (yesterday). This followed the merge that allowed Ethereum to transform from a Proof of Work to a Proof-of-Stake consensus mechanism.
“Grayscale has announced today that each of the products has declared a distribution and established a record date for the distribution of rights to the ETH proof of work tokens (‘ETHPoW’), which were received by each of the Products as a result of a fork in the Ethereum blockchain on September 15, 2022, following the upgrade referred to as the “Merge,” to holders of record of each Product (“Record Date Shareholders”), as of the close of business on September 26, 2022 (the “Record Date”).”
Grayscale Ethereum Funds
The two Grayscale Ethereum-related funds with rights to ETHW include; Grayscale Ethereum Trust (ETHE) and Grayscale Digital Large Cap Fund (GDLC). These two Grayscale funds give investors direct access and exposure to ETH.
Grayscale Ethereum Trust (ETHE) received rights totaling 3,059,976.06309448 ETHPoW tokens. These tokens represent a staggering 0.00986585 ETHPoW tokens that Grayscale will share with the total 310,158,500 shares outstanding in the trust fund.
On the other hand, Grayscale’s other fund, Grayscale Digital Cap Fund (GDLC), received passive rights that totaled 40,653.24325763 ETHPoW tokens for GDLC. This represents 0.00256206 ETHPoW tokens per share that are calculated on 15,867,400 total shares outstanding.
Ethereum Proof-of-Work tokens is currently not established widely, given that the consensus is only one-day-old (launched on September 15, 2022). There is also a lot of uncertainty and confusion on whether retail and institutional investors and custodians will support the new Ethereum consensus mechanism. The other risk factor that Grayscale shareholders cannot ignore is that trading markets with significant liquidity may never develop.
If investors and institutions accept the token and trading markets come to life, wide fluctuation and the market liquidity for the new PoW tokens will ensue as the confusion brought about by Ethereum merge slowly fades away. The uncertainty makes it impossible to describe the exact value of EthereumPoW tokens.
Grayscale also states that the tokens will be sold and the net cash distributed to investors and holders in the two funds, ETHE and GDLC, later on, September 26, 2022. Grayscale also mentioned that to sell these tokens, the company may use external affiliated dealers such as Genesis Global to facilitate the sale of the tokens.