Grayscale Investments, a leading cryptocurrency investment firm, has officially decided to relinquish its rights to the Ethereum tokens that followed the significant event known as the Merge. The decision, announced on Sunday, was made due to a lack of liquidity and support from the custodian of its products for these post-Merge Proof-of-Work (PoW) Ethereum (CRYPTO:ETH) tokens, also known as ETHPoW.
The Merge, which took place on September 15, 2022, marked a complete transition for Ethereum from a Proof-of-Work (PoW) system to a Proof-of-Stake (PoS) system. This resulted in a split of the Ethereum blockchain into a primary PoS-based Ethereum and a secondary PoW-based Ethereum.
Following this significant shift, Grayscale considered acquiring ETHPoW and potentially selling ETHW for its record date shareholders. However, after an additional six months of deliberation following the Merge, the firm decided against this course of action. The decision was influenced by uncertainties around the stance of digital asset custodians and trading platforms on supporting ETHW tokens.
In contrast to Grayscale's decision, some crypto investment firms like ETC Group attempted to launch specific EthereumPoW exchange-traded products (ETPs). However, due to a lack of suitable custody providers, ETC Group had to discontinue its PoW-centric ZETW ETP just six weeks after its launch.
Grayscale's decision is expected to be discussed at the upcoming Benzinga's Future of Digital Assets conference on November 14. Industry shifts such as Grayscale's move away from ETHPoW tokens are likely to be key topics at this event.
In related news, just a day after announcing its decision on ETHPoW tokens, Grayscale expressed intentions to introduce a new Ether (ETH) futures exchange-traded fund. The firm approached the United States Securities and Exchange Commission on Monday, seeking approval to list and exchange shares of the Grayscale Ethereum Futures Trust (ETH) ETF under the guidelines of the New York Stock Exchange Arca Rule 8.200-E.
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