Grayscale, a prominent cryptocurrency investment firm, has recently made a significant move by relinquishing all rights to post-Merge proof-of-work (PoW) Ethereum tokens (ETHPoW).
This decision, announced on September 18, entails Grayscale’s complete abandonment of ETHPoW tokens on behalf of its record date shareholders.
After a thorough evaluation, Grayscale concluded that ETHPoW tokens had failed to develop substantial liquidity, and the custodian responsible for these products did not offer support for such tokens.
In their official statement, Grayscale explained, “As such, it is not possible to exercise the rights to acquire and sell the ETHPoW tokens, and on behalf of the record date shareholders, Grayscale is abandoning the rights to these assets.”
This decision comes over a year after the Ethereum Merge, a monumental event that signified Ethereum’s full transition from proof-of-work (PoW) to proof-of-stake (PoS).
The Merge took place on September 15, 2022, effectively splitting the Ethereum blockchain into the primary PoS-based Ethereum and a secondary PoW-based Ethereum network.
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In the aftermath of the Merge, Grayscale deliberated whether to acquire EthereumPoW tokens and subsequently sell ETHW on behalf of its record date shareholders.
However, uncertainty regarding the support for ETHW tokens by digital asset custodians and trading platforms led the company to take an additional six months before reaching a decision.
It’s worth noting that while Grayscale opted to abandon ETHPoW rights, other cryptocurrency investment firms like ETC Group ventured into launching dedicated EthereumPoW exchange-traded products (ETPs).
Nonetheless, ETC Group discontinued its PoW-based ZETW ETP merely six weeks after its launch due to the lack of eligible custody providers.
Interestingly, Grayscale’s decision to forego ETHPoW tokens was revealed just one day before the firm proposed launching a new Ether futures exchange-traded fund.
On September 19, Grayscale filed an application with the United States Securities and Exchange Commission to list and trade shares of the Grayscale Ethereum Futures Trust (ETH) ETF on the New York Stock Exchange Arca Rule 8.200-E.
This move underscores Grayscale’s ongoing commitment to exploring and participating in the evolving landscape of cryptocurrency investment opportunities.
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