Guggenheim Partners prepares to dip investment fund’s toes into Bitcoin

CoinTelegraph

An SEC filing on Friday indicates that the next Wall Street institution to take a public position in Bitcoin may also be among the largest yet: the $275 billion financial services firm Guggenheim Partners. 

The Guggenheim filing allows the Macro Opportunities fund to purchase GBTC, a publicly-traded Bitcoin investment vehicle from Grayscale, at an indeterminate point in the future. 

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“The Guggenheim Macro Opportunities Fund may seek investment exposure to bitcoin indirectly through investing up to 10% of its net asset value in Grayscale Bitcoin Trust (“GBTC”),” the filing reads.

According to independent ratings firm Morningstar, the Guggenheim Macro Opportunities fund currently has $5.3 billion in assets under management and sports a four-star rating “based on risk-adjusted returns out of 270 Nontraditional Bond funds.”

Guggenheim describes the overall fund strategy for the institutional-grade shares (ticker: GIOIX) as a product of the investment team’s “highest-conviction ideas.” If the fund were to take the full 10% stake in GBTC, it would be worth north of $500 million.

The filing also notes a long list of potential investor risks associated with cryptocurrencies, which it refers to as “digital assets designed to act as a medium of exchange.” Risks include lack of cryptocurrency exchange regulation, GBTC’s historical “significant premium” to net asset value, and uncertainty regarding tax laws and regulations, among others.

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This preparatory move by Guggenheim appears to be part of a cascading series of investments indicating increased acceptance of Bitcoin among major financial institutions. In August, business intelligence firm Microstrategy purchased nearly 40,000 Bitcoin, leading to a parabolic move in share price. Likewise, financial services firm Square, Inc bought $50 million in Bitcoin in October.

This rolling snowball of institution interest may quickly become an avalanche, as noted by one prominent voice in crypto journalism: 

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Author: Andrew Thurman


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