Morgan Chittum

<div id="highlights-block_6197d2acb036a" class="highlights">
 <ul>
 <li>The firm has previously launched four funds: Osprey Bitcoin Trust, Osprey Solana Trust, Osprey Algorand Trust and Osprey Polkadot Trust</li>
 <li>Osprey has hired former Stocktwits executive, Justin Paterno, as managing director of the NFT fund</li>
 </ul>
 
</div>



Osprey Funds, one of the largest cryptocurrency investment firms, <a href="https://www.businesswire.com/news/home/20211118005296/en" target="_blank" rel="noreferrer noopener">announced</a> plans to launch a non-fungible token (NFT) fund on Thursday.&nbsp;



Dubbed “Osprey Alpha”, the NFT-focused investment vehicle will allow high-net worth individuals and institutional investors exposure to funds that invest in NFTs including assets such as gaming, art and a variety of digital collectibles.



“We’re in business to provide investors with exposure to the most exciting segments of the digital asset ecosystem,” Greg King, CEO of Osprey Funds, said in a statement. “With Osprey Alpha, we will focus on the development and rollout of several unique, actively-managed strategies for sophisticated investors, beginning with our NFT product.”



Additionally, Osprey has hired former Stocktwits executive and NFT collector, Justin Paterno, as managing director of the fund. Paterno will design the fund’s investment strategy, according to a press release.



“I see similarities between NFTs now and the early days of Web 2.0. Communities and networks have always been a major driver of value on the web — which increasingly defines culture,” Paterno said.



<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow">“NFTs allow communities to own the cultural capital they create. There is immense growth potential here.”</blockquote>



The Connecticut-based firm previously launched four other funds including Osprey Bitcoin Trust, <a href="https://cms.blockworks.co/osprey-funds-launches-solana-trust-amid-tokens-rally/" target="_blank" rel="noreferrer noopener">Osprey Solana Trust</a>, Osprey Algorand Trust and Osprey Polkadot Trust.



“At Osprey, I think, at a fundamental level, we fully believe in the power of blockchain-based technologies. Period. We’ve set ourselves up to both invest and help others invest in those technologies for the benefit of their long-term investment portfolios,” King previously told <a href="https://cms.blockworks.co/qa-ceo-greg-king-says-osprey-is-fully-committed-to-digital-assets/" target="_blank" rel="noreferrer noopener">Blockworks</a>.



Osprey Alpha is slated to launch early next year, according to the press release.



<hr class="wp-block-separator">
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Greg King

Osprey Funds to Launch NFT-focused Investment Vehicle

Ben Strack

<div id="highlights-block_614a27561d180" class="highlights">
 <ul>
 <li>Osprey Funds’ support of Ethereum-compatible blockchain Polygon (formerly Matic Network) comes after the firm launched an offering earlier this month focused on layer-1 Solana</li>
 <li>Top holdings of the First Trust SkyBridge Crypto Industry and Digital Economy ETF (CRPT) include Coinbase, Marathon Digital, Riot Blockchain, MicroStrategy and Square</li>
 </ul>
 
</div>



Osprey Funds has launched the first US fund to invest exclusively in the native token of the Polygon network, while First Trust Advisors and SkyBridge Capital have brought to market a new actively managed ETF that will buy the stocks of crypto and digital economy companies.



A protocol for developing blockchains on top of Ethereum, Polygon gains from Ethereum’s secure network while mitigating common blockchain pain points, such as high gas fees and slow transactions, according to Osprey Funds CEO Greg King.



“Polygon is compelling for the flexibility that it brings to ETH,” King told Blockworks in an email. “It is not just a layer-2 scaling solution — it delivers a set of tools that facilitate exciting new [decentralized apps] while still being part of the Ethereum ecosystem.”



Its native token, $MATIC, was priced at $1.12 as of 1:30 pm Eastern on Tuesday, according to <a href="https://www.coingecko.com/en/coins/polygon" target="_blank" rel="noreferrer noopener">CoinGecko</a>, which was down 10.6% in the last seven days. Polygon’s market capitalization was just below $7.5 billion at that time.



While often described as a layer-2, Polygon’s security model is based on an independent set of validator nodes that stake $MATIC and participate in validating transactions. Polygon periodically creates “checkpoints” recorded on the Ethereum mainnet, roughly every 10 minutes, of its state — a snapshot of its transaction record. That increases its security relative to some blockchains, but the Proof-of-Stake commit chain — an entirely separate blockchain — is quite different from layer-2 implementations built on top of Ethereum mainnet, like Optimism and Arbitrum, which inherit Ethereum’s security directly through the use of &#8220;optimistic <a href="https://ethereum.org/en/developers/docs/scaling/layer-2-rollups/" target="_blank" rel="noreferrer noopener">rollups</a>.&#8221;



<div class="wp-block-image"><figure class="aligncenter size-large is-resized"><img loading="lazy" decoding="async" src="https://blockworks-co.imgix.net/wp-content/uploads/2021/09/2021-09-21-polygon-intrographic-2-1-1024x1024-1-1024x1024-1.jpg" alt="" class="wp-image-8338" width="512" height="512"/><figcaption>Graphic: <a href="https://immunebytes.com/introduction-to-polygon-is-it-the-solution-to-ethereums-problems/" target="_blank" rel="noreferrer noopener">immunebytes.com</a></figcaption></figure></div>



<h3 class="wp-block-heading">Branching out</h3>



Osprey’s launch comes about two weeks after the New York-based digital asset manager <a href="https://cms.blockworks.co/osprey-funds-launches-solana-trust-amid-tokens-rally/'" target="_blank" rel="noreferrer noopener">kicked off</a> the <a href="https://ospreyfunds.io/products/osol/" target="_blank" rel="noreferrer noopener">Osprey Solana Trust</a> for private placement. It also offers products focused on Bitcoin, Polkadot and Algorand.



Like the Solana Trust, the Polygon Trust is currently available to accredited investors and has a $10,000 minimum investment. Osprey intends to list the fund on the OTCQX market and has agreed to waive the management fee for all investors until January 2023.



King told Blockworks at the time that the firm was focused on launching first-to-market funds that track promising layer-1 protocols. Though he labeled Solana and Algorand as potential challengers to Ethereum, he said Osprey remains supportive of Ethereum.



Tushar Jain, a managing partner at Multicoin Capital, <a href="https://cms.blockworks.co/das-2021-are-layer-1s-better-than-layer-2s/" target="_blank" rel="noreferrer noopener">argued at Blockworks’ Digital Asset Summit</a> last week that layer-1 blockchains are currently more reliable than the layer-2s built on top of them. Ava Labs President John Wu said, <a href="https://cms.blockworks.co/das-2021-ava-labs-wu-says-economies-will-depend-on-next-gen-layer-1s/" target="_blank" rel="noreferrer noopener">during a separate session</a> at the conference, that the new wave of layer-1s “are where the economies will be.”&nbsp;



“Our future product development will continue its focus on layer 1s,” King said Tuesday, “but layer 2s and beyond are possible as we broaden the Osprey product set.”



Broader crypto exposure in an ETF



Also on Tuesday, First Trust unveiled an actively managed ETF sub-advised by SkyBridge Capital.



<a href="https://www.ftportfolios.com/LoadContent/gchdqptsgrao" target="_blank" rel="noreferrer noopener">The First Trust SkyBridge Crypto Industry and Digital Economy ETF</a> (CRPT) seeks to invest at least 80% of its net assets in the stocks and American depository receipts of crypto and digital economy companies. It will not invest directly in digital assets or indirectly through the use of derivatives or through investments in funds or trusts that hold them.



Anthony Scaramucci, founder and managing partner of SkyBridge, said in a statement that cryptocurrency adoption represents “the biggest macro trend since the commercialization of the internet.” The fund, which costs 85 basis points, will be managed by Scaramucci and Brett Messing, SkyBridge’s president and co-chief investment officer.



CRPT’s top five holdings are Coinbase, Marathon Digital, Riot Blockchain, MicroStrategy and Square, Bloomberg Intelligence Senior ETF Analyst Eric Balunchas noted in <a href="https://twitter.com/EricBalchunas/status/1440302883669348364" target="_blank" rel="noreferrer noopener">a Twitter post</a>.&nbsp;



The new fund’s largest competitor will be Amplify Investments’ Transformational Data Sharing ETF (BLOK), which has nearly $1.3 billion in assets. That actively managed product, which launched in January 2018, carries an expense ratio of 71 basis points.&nbsp;



VanEck’s Digital Transformation ETF (DAPP) and Bitwise Asset Management’s Crypto Industry Innovators ETF (BITQ), are index offerings that launched in April and May, respectively. DAPP costs 50bps, while BITQ is priced at 85bps.



“The honest truth is that there are so few companies that are even remotely pure plays in the space that they all look remarkably similar,” Dave Nadig, chief investment officer and director of research at ETF Trends, told Blockworks. “The top tens for BITQ, DAPP and CRPT are all essentially the same if not very close, with the weighting schemes the main difference.”



<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow">“While I think it&#8217;s great there are so many options out there, choosing between them is extremely difficult based on anything but a most cursory set of analysis,” Nadig added. “Do you want indexed or not, what kind of concentration can you stomach, how long do you plan on holding and thus how fee sensitive are you?”</blockquote>



Other funds in the space include the Siren Nasdaq NexGen Economy ETF (BLCN), the Capital Link Global Fintech Leaders ETF (KOIN) and First Trust’s own Indxx Innovative Transaction &amp; Process ETF (LEGR). Invesco <a href="https://cms.blockworks.co/invesco-proposes-crypto-economy-etf/" target="_blank" rel="noreferrer noopener">revealed plans in June</a> to launch a Crypto Economy ETF that would invest primarily in entrenched crypto companies and up to 10% in bitcoin futures contracts.



<hr class="wp-block-separator">
Are you a UK or EU reader that can’t get enough investor-focused content on digital assets?<a target="_blank" href="https://cms.blockworks.co/events/das-london/" rel="noreferrer noopener">Join us</a>&nbsp;in London on November 15th and 16th for the Digital Asset Summit (DAS) London. Use code ARTICLE for £75 off your ticket.&nbsp;<a target="_blank" href="https://cms.blockworks.co/events/das-london/" rel="noreferrer noopener">Buy it now</a>.
<hr class="wp-block-separator">

Anthony Scaramucci

Polygon Trust, and Crypto Economy ETF Hit the Market

<div id="highlights-block_613a5150dc4ec" class="highlights">
 <ul>
 <li>Product joins other Osprey funds offering exposure to bitcoin, Algorand and Polkadot as firm is focused on providing investor access to promising Layer 1 protocols </li>
 <li>SOL reached as high as $213.47 within the last day, according to CoinGecko, and its price of $196.75, as of 1:30 p.m. eastern, was up 77.6% from seven days ago</li>
 </ul>
 
</div>



Osprey Funds’ has launched the first investment vehicle to offer exposure to SOL, the native token used on the <a href="https://cts.businesswire.com/ct/CT?id=smartlink&amp;url=https%3A%2F%2Fsolana.com%2F&amp;esheet=52488403&amp;newsitemid=20210909005181&amp;lan=en-US&amp;anchor=Solana+blockchain&amp;index=3&amp;md5=e5a8b3484757c2518d01aae8947de601">Solana blockchain</a> as the token’s price has recently rallied.



The New York-based digital asset manager announced on Thursday morning the launch of the <a href="https://ospreyfunds.io/products/osol/" target="_blank" rel="noreferrer noopener">Osprey Solana Trust</a> for private placement. 



Currently available to accredited investors with a $10,000 minimum investment, the firm plans to pursue listing the fund on the OTCQX market, according to a news release. It has also agreed to waive the management fee for all investors until January 2023.



<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow">“We’ve been focused on launching first-to-market funds that track what we think are promising Layer 1 protocols,” Osprey Funds CEO Greg King told Blockworks. “Solana is a great example of that [with its] extremely fast transaction speed and low costs.”</blockquote>



Anatoly Yakovenko, Solana’s founder and CEO, introduced proof-of-history to the blockchain, an algorithmic solution for time-stamping transactions. The innovation enables the Solana network to process 65,000 transactions per second, with sub-second block finality. The firm expects the network to get faster as its bandwidth increases.



Matthew Sigel, head of digital assets research at fund manager VanEck, previously said that the proliferation of <a href="https://cms.blockworks.co/competition-in-layer-1-space-continues-to-heat-up/" target="_blank" rel="noreferrer noopener">competing Layer 1 smart contract platforms</a> has come about amid a higher demand for lower transaction prices and faster throughput than what the Ethereum network provides. He noted that Solana’s transactions per second could rival Nasdaq, opening up the potential to securitize, tokenize and trade existing assets using the Solana network.



King said that Osprey became determined to launch a Solana product after meeting with the Solana team in June in Miami. The firm also offers the <a href="https://cts.businesswire.com/ct/CT?id=smartlink&amp;url=https%3A%2F%2Fospreyfunds.io%2Fproducts%2Fobtc%2F&amp;esheet=52488403&amp;newsitemid=20210909005181&amp;lan=en-US&amp;anchor=Osprey+Bitcoin+Trust+%28OBTC%29&amp;index=4&amp;md5=ac0f72e19cb2f603ae6792544ff9dfdf" target="_blank" rel="noreferrer noopener">Osprey Bitcoin Trust (OBTC)</a>, the <a href="https://cts.businesswire.com/ct/CT?id=smartlink&amp;url=https%3A%2F%2Fospreyfunds.io%2Fproducts%2Fopt%2F&amp;esheet=52488403&amp;newsitemid=20210909005181&amp;lan=en-US&amp;anchor=Osprey+Polkadot+Trust&amp;index=5&amp;md5=9ddb9d920745a43c261ada8b0209be68" target="_blank" rel="noreferrer noopener">Osprey Polkadot Trust</a> and the <a href="https://cts.businesswire.com/ct/CT?id=smartlink&amp;url=https%3A%2F%2Fospreyfunds.io%2Fproducts%2Foalg%2F&amp;esheet=52488403&amp;newsitemid=20210909005181&amp;lan=en-US&amp;anchor=Osprey+Algorand+Trust&amp;index=6&amp;md5=d307e675397f4676eeb8390e3a2b0eda" target="_blank" rel="noreferrer noopener">Osprey Algorand Trust</a>.



“We’ve seen it integrating itself into the NFT boom and there are so many other potential applications for Solana,” King added. “So for us it was a logical next step in terms of our product development.”



The launch comes as SOL’s price has <a href="https://cms.blockworks.co/solana-soars-while-btc-eth-and-cardano-dip/" target="_blank" rel="noreferrer noopener">increased in recent days</a> while competing tokens have dipped. 



SOL reached as high as $213.47 within the last day, according to <a href="https://www.coingecko.com/en" target="_blank" rel="noreferrer noopener">CoinGecko</a>. Its price of $196.75, as of 1:30 pm eastern, was up 77.6% from seven days ago, the data shows. Its market capitalization of about $58 billion is now the sixth-highest among tokens, behind Binance Coin and ahead of XRP.



The price of seven of the other nine top 10 tokens by market cap were down from seven days ago, CoinGecko indicated, aside from Tether and USD Coin, which were essentially flat — up 0.2% and 0.1%, respectively, over the span.



King attributed some of the recent buzz around Solana to crypto exchange FTX’s announcement that its new NFT marketplace would allow creators and owners to trade their digital art using both Solana and Ethereum.



“I think it’s just caught wind out there in the face of what was otherwise a <a href="https://cms.blockworks.co/bitcoin-drops-nearly-11-tuesday-on-whale-leverage-liquidations/" target="_blank" rel="noreferrer noopener">fairly sharp pull-back</a>,” the Osprey Funds CEO said. “We felt it was pretty impressive to see Solana hold up and make gains the last few days.”



Though Ethereum has the early lead in the decentralized finance, or DeFi space, King said, he labeled Solana and Algorand as potential challengers. Osprey remains supportive of Ethereum, he added, and continues to monitor the space from a product standpoint.



“No one knows how this is going to end,” King said. “But our focus is on bringing these types of layer-one protocols that we do think can carve out a niche or even be very broadly and widely used … to market in a way so that investors who need more traditional access vehicles, like funds, can participate.”



Are you a UK or EU reader that cant get enough investor-focused content on digital assets?<a target="_blank" href="https://cms.blockworks.co/events/das-london/" rel="noreferrer noopener">Join us</a> in London on November 15th and 16th for the Digital Asset Summit (DAS) London. Use code ARTICLE for £75 off your ticket. <a target="_blank" href="https://cms.blockworks.co/events/das-london/" rel="noreferrer noopener">Buy it now</a>.

Osprey Funds Launches Solana Trust Amid Token’s Rally

<div id="highlights-block_610b46b09083b" class="highlights">
 <ul>
 <li>To date, Osprey has launched three funds: Osprey Bitcoin Trust, Osprey Algorand Trust and Osprey Polkadot Trust</li>
 <li>King says the company has plans to offer clients even more investment options in the future</li>
 </ul>
 
</div>



As traditional financial and digital assets markets are slowly merging, Blockworks is taking a closer look at how fund managers are navigating the volatile market.



I spoke with <a href="https://ospreyfunds.io">Osprey Funds</a>’ co-founder and CEO Greg King, CFA, about what sets the digital asset investment firm apart from competitors and how they appeal to their investors. The fund operates with approximately 15 employees and $115 million AUM, as of interview time.&nbsp;



King has taken both his interest in crypto and traditional finance experience to help found Osprey in 2018. Previously, he worked as Head of Exchange Traded Products at Credit Suisse and held key positions at Barclays Capital. King received his MBA from University of California Davis.



Osprey has launched three funds (so far) for investors, including their Bitcoin Trust, Algorand Trust and Polkadot Trust.



King, CFA, says the company has plans to offer clients even more investment options in the future.



Chittum: What gives Osprey Funds an edge over competitors like Grayscale? How do you set yourselves apart?



King: As we develop a product lineup overtime, I think investors will be able to see how we differentiate…. We have the bitcoin fund which is done at a lower price point and with different service providers. The other funds that we have rolled out are both first-to-market products that don’t compete with anything that Grayscale has.



Right now, we have single asset-based trusts. We have three products: Bitcoin, Algorand and Polkadot. In the future, you’ll see us launch index based products… so they’ll give broader exposure for investors. You’ll also see actively managed strategies that are not just passive beta products. They will be alpha products.



One of the differentiators around Osprey is that we are fully focused on digital assets only. We are committed long term to the space. This is not just an experimental product launch. We are building a world class investment firm and are excited about the growth prospects it has.



Chittum: How would you describe Osprey’s investment strategy?



King: At Osprey, I think, at a fundamental level, we fully believe in the power of blockchain-based technologies. Period. We’ve set ourselves up to both invest and help others invest in those technologies for the benefit of their long-term investment portfolios.&nbsp;



We believe in diversification as a strategy. I believe that investors benefit from having their portfolio professionally managed, either by themselves or by more formal institutions…Our main purpose is to really help give investors access — from an investment perspective — to the potential returns in growth that we think is generational in terms of the magnitude of blockchain-based technologies.&nbsp;



Chittum: What’s something that attracts those investors to your fund? What type of investors are you targeting?&nbsp;



King: The products are built to an institutional caliber so we are focused on and [are] able to offer them to institutional clients. The majority of our assets have come from institutional clients. However, they’re also available to individual investors and we are committed to creating more pathways to access them. [This is] primarily by registering them under a ticker symbol to be traded whenever possible.



Chittum: What is something you wish more investors knew about Osprey?



King: I think they should understand the depths of the team’s backgrounds in both [exchange traded funds] and crypto. Not just myself but other members of our teams have decades of experience working with ETFs for large companies like Barclays, Deutsche Bank, JPMorgan and more.

Greg King

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