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Cardano (ADA) is back in the Grayscale Digital Large Cap Fund (GDLC).
Over the past few months, Cardano (ADA) has experienced a renaissance thanks to technical developments, key partnerships, and a significant price surge.
This renaissance may have now translated to increased institutional adoption per a quiet change in the composition of Grayscale‘s largest multi-asset fund.
Cardano Returns to Grayscale Digital Large Cap Fund
In April 2024, leading crypto asset manager Grayscale had the Cardano (ADA) community up in arms over its decision to drop the asset from the Grayscale Digital Large Cap Fund (GDLC), its largest multi-asset fund.
At the time, the firm cited a rebalancing in the CoinDesk Large Cap Select Index (DLCS), which the fund tracks. This index measures the market cap-weighted performance of the five most liquid non-stablecoin crypto assets in the top 20 by market capitalization.
Fast forward to January 6, 2024, ADA is now back in the GDLC per Grayscale’s website, reflecting an increase in ADA volumes in recent months.
While it is not clear exactly when Grayscale made the change, it is likely to have happened around Q4 2024, aligning with ADA’s over 300% price surge from $0.3263 to highs of $1.3264. Grayscale’s Q3 rebalancing statement also did not include ADA in the GDLC.
ADA replaces Avalanche (AVAX) to join Bitcoin (BTC), Ethereum (ETH), Solana (SOL), and XRP in the $811.5 million fund.
Increased Institutional Adoption for Cardano (ADA)
With ADA’s return to the GDLC, it looks set to get increased institutional exposure. Representing 1.44% of the market cap-weighted fund’s composition, the fund holds over $11 million worth of ADA for investors.
This ADA holding could balloon in the near future if Grayscale receives approval to convert the GDLC into an exchange-traded fund. The firm filed to do so in October 2024.