Key Insights
- Grayscale has filed for a spot Dogecoin ETF under the ticker GDOG.
- According to reports, Coinbase Custody will safeguard the ETF’s Dogecoin assets.
- DOGE trades near $0.23 and has had a relatively muted reaction to the filing.
Grayscale has taken another major step in its effort to expand its crypto investment products. The firm has just filed an S-1 registration statement with the U.S. SEC for a spot Dogecoin ETF.
If approved, the fund will be called the Grayscale Dogecoin Trust ETF. It will trade on NYSE Arca under the ticker GDOG.
Grayscale Files for Dogecoin ETF with Coinbase Custody
Grayscale has chosen Coinbase Custody Trust Company to safeguard the ETF’s assets. According to the filing, Dogecoin will serve as the trust’s sole asset. Additionally, shares will be created and redeemed in blocks of 10,000, known as Baskets.
Unlike other funds, settlement will be in cash at the start, rather than direct DOGE transfers. The trust will also follow the CoinDesk Dogecoin Reference Rate for pricing. This is expected to show DOGE’s market value without including liabilities or fees.
The structure will also be passive. It will not engage in active trading, leverage, or derivatives. Instead, it is designed to track the price of Dogecoin while providing institutional investors access.
Market Reaction to the Dogecoin ETF Filing
The news of Grayscale’s Dogecoin ETF filing hasn’t done much for Dogecoin’s price lately. The asset is trading near $0.23, down by around 2.3% in the past week.
Data from TradingView shows that after the filing, DOGE briefly rose 2.5% from $0.22395 to $0.22976. The price has since stabilised. Also, it still indicates a sideways trend that has marked most of its price action for the year.
Despite the relatively slow response, Dogecoin has gained around 14.6% over the past 30 days. This indicates that it is undergoing a gradual recovery. However, investors appear to be cautious, since the ETF still requires SEC approval before trading can begin.
Competition in Meme Coin ETFs
Grayscale is not alone in targeting the Dogecoin ETF space. Bitwise filed its S-1 in January and named Coinbase custody as the asset holder. However, the company did not disclose its ticker or exchange listing athen
Rex-Osprey has also applied for a spot in a Dogecoin ETF. Also, several other firms have filed for meme coin products tied to TRUMP, BONK, and Pudgy Penguins.
James Seyffart believes firms are pushing boundaries with their latest ETF filings. He says they’re probing how far the SEC is willing to go under current leadership. If even one of them gets approved soon, it will likely determine the future of memecoin ETFs in financial markets.
Grayscale’s ETF Strategy
The Dogecoin ETF filing comes as Grayscale attempts to expand its presence in U.S. capital markets. The company recently submitted a filing for a U.S. IPO, just months after Gemini filed for a confidential IPO.
Grayscale manages over $33 billion in assets across Bitcoin, Ether, and over three other products. This means that its push for a Dogecoin ETF is likely part of its strategy to increase variety in its offerings. They are also planning to gain more institutional demand for these tokens.
The ETF format is expected to bring stronger liquidity and lower fees than the existing trust structure. In other words, it will likely be more attractive for retail and institutional investors seeking exposure to Dogecoin.
Grayscale’s filing for a Dogecoin ETF is a major win for meme coin investing. This is despite the relatively muted reaction of the Dogecoin asset itself to the news. While DOGE has not surged yet, institutional interest is on the rise.
Whatever the SEC decides will determine whether the product reaches the market. It could give investors easier access to Dogecoin and open the doors to other meme coin ETFs if approved.
