Will Grayscale be the next FTX?
On Nov. 18, Grayscale, the asset manager running the world’s largest Bitcoin (BTC) fund, released a statement detailing the security of its digital assets products and affirming that it won’t share its proof of reserves with customers.
“Due to recent events, investors are understandably inquiring deeper into their crypto investments,” the statement begins, which is quite the understatement following the implosion of FTX and the inquiry into Sam Bankman-Fried’s questionable leadership. In no time, the question on everyone’s lips became clear. Will Grayscale be next?
The answer is that it’s unlikely. And that’s largely because the people at the top, the ones who made Grayscale what it is, appear to be more competent than Sam Bankman-Fried ever was.
Let’s look at the facts.
It’s true and possibly undeniable that the crypto industry will take another dive if Grayscale doesn’t fix its balance sheet. The space simply cannot afford another crash, not so soon after FTX and not that of such a key player. Grayscale oversees more than $10 billion in BTC, Ether (ETH) and other assets and represents its parent company’s biggest revenue generator.
Related: It’s time for crypto fans to stop supporting cults of personality
Grayscale’s parent company — the same that owns trading firm Genesis, mining company Foundry, crypto investment app Luno, and media outlet CoinDesk, among others — is Digital Currency Group, whose founder and CEO Barry Silbert shared a note to DCG shareholders on Nov. 23 addressing all the “noise” surrounding the company. He indicated that despite the so-called crypto winter, the company was on track to reach $800 million in revenue and its separate entities were “operating as usual.”
“We have weathered previous crypto
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