Osprey Funds Looking To Offer Solana Trust

Investment offering would be available to accredited investors and require minimum investment of $10,000.


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key takeaways

  • Solana had the largest inflows of any digital asset last week, bringing in $7.1 million, according to a CoinShares report
  • New York-based firm currently offers three trusts focused on giving investors access bitcoin, as well as the native tokens of Algorand and Polkadot networks

Osprey Funds is seeking to bring an investment offering focused on Solana (SOL) as the token has become a top 10 digital asset by market capitalization.

The Tarrytown, New York-based firm filed a document with the SEC on Tuesday for an Osprey Solana Trust. The proposed product looks to be seeking permission to launch only to accredited investors, and the minimum investment for an outside investor would be $10,000.

It appears that the trust would be the first private Solana investment offering in the US. Competing firm Grayscale Investments announced in June that it was considering adding Solana to its product family. 

An Osprey spokesperson for the company declined to comment on the filing. 

The investment manager currently offers the Osprey Bitcoin Trust (OBTC), as well as trusts that provide a way for accredited investors to access the native tokens of the Algorand and Polkadot networks. OBTC has about $137 million in assets, while the Polkadot and Algorand products have roughly $19 million and $12 million, respectively.    

A competitor to Etherum

Solana is a blockchain driven by intra-shard parallelism, which is capable of processing thousands of smart contracts at once, according to the firm, as well as proof-of-history, an innovation in distributed timekeeping that unlocks low-latency, sub-second finality.

Known as a competitor to Ethereum that offers a flexible infrastructure and faster transaction settlement, Solana had the largest inflows of any digital asset last week, bringing in $7.1 million, according to a CoinShares report released on Monday. 

Ethereum had $3.2 million of inflows, while other altcoins Cardano, Litecoin and Polkadot brought in $6.4 million, $1.8 million and $1.1 million, respectively. Meanwhile bitcoin endured its seventh straight week of outflows, amounting to $2.8 million. This streak matches one seen in 2018.

“For a while now the focus has been on Ethereum, but we are seeing spillover into alternative Layer 1 solutions like Solana,” CoinShares Investment Strategist James Butterfill told Blockworks in an email. “As Solana addresses many of the issues Ethereum currently faces, such as scalability, it has recently gained investor interest.”

Solana Labs, the blockchain studio that incubates and launches decentralized finance projects built on Solana, announced in June that it had raised over $314 million of new funding in a private token sale led by Andreessen Horowitz and Polychain Capital.

Solana’s token price boomed to above $80 a few days ago amid rising non-fungible token, or NFT, sales. Earlier this month, The Degenerate Ape Academy was listed on NFT platform Solanart, which uses the Solana blockchain to mint digital art. All 10,000 cartoon apes sold in eight minutes.

Layer 1 protocols are booming

As of Noon eastern time on Wednesday, (SOL) was priced at $71.41, which was up 11% from seven days ago, according to CoinGecko. Its total market capitalization stands at nearly $21 billion, which is 10th most among digital tokens, the data shows, ahead of Uniswap. 

Michael Novogratz, CEO of Galaxy Digital, said during the firm’s second quarter earnings call that though Galaxy is very bullish on Ethereum, Layer 1 protocols like Solana are booming as people are questioning if Ethereum will be “the winner” within the DeFi space. 

“The whole level one space right now is all very exciting, but it’s because people are seeing where this is going in three to four years,” Novogratz said. “They’re seeing that NFTs aren’t a fad and that it’s a way that we are going to monetize value and creativity.”

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