According to the announcement, the co-investment vehicle is called Grayscale Digital Infrastructure Opportunities (GDIO), and cryptocurrency mining company Foundry will handle operations for the new product. GDIO is intended for “Capturing the Rise of Crypto Winter“, according to Grayscale’s announcement on Thursday.
Grayscale’s new co-investment vehicle, GDIO, seeks opportunities in crypto-economy market cycles. – Day-to-day operations will be handled by Foundry Digital
Grayscale Investments, the world’s largest digital currency asset manager, on Thursday announced the launch of a new co-investment opportunity, a financial vehicle that aims to capitalize on market cycles in the crypto economy. The new co-investment product is the first of its kind for Grayscale and the mining infrastructure and bitcoin staking company. Foundry Digital will manage the day-to-day operations of the business.
For the past 12 months, Foundry has been the largest bitcoin mining pool by total hashrate. The company’s mining pool captured 19.38% of the global hashrate this year, or uncovered around 10,375 of the 53,532 BTC blocks found in the last 12 months. The bear market has been troublesome for miners this year, and Grayscale believes the cryptocurrency winter may provide some unique investment opportunities.
Grayscale’s investment thesis is as follows:
With the dramatic fall in the price of bitcoin, leveraged miners have come under significant pressure on their operating margins. In the coming months, we expect some miners to be forced to liquidate their mining equipment. We believe that GDIO will have the ability to purchase mining equipment at unfavorable levels and profitably mine bitcoin in the future.
For example, crypto miner Cleanspark explained last summer that the downturn in the crypto economy has produced “unprecedented opportunities.“At the end of June, a report noted that $4 billion in Bitcoin mining loans were in distress. Additionally, in September, Jihan Wu’s Bitdeer launched a $250 million fund to help struggling miners. Grayscale CEO Michael Sonnenshein says his company has an edge over others that allows Grayscale to find opportunities in the cryptocurrency winter cycle.
“Grayscale’s unique position at the center of the crypto ecosystem allows us to create offerings that allow investors to grow their capital through different market cycles“, noted Michael Sonnenshein in the announcement. “Our team has long been committed to lowering the barriers to investing in the crypto ecosystem – from direct exposure to digital assets, to diversified thematic products, and now to infrastructure via GDIO.“