Bitcoin BTC/USD asset management company greyscale announced a new investment product that will give investors access Bitcoin mining equipment.
The fund will generate money to purchase Bitcoin ASIC computers that Foundry Digital will operate to mine and trade Bitcoin for investors.
The wealth management company’s strategic mining game
The goal of Possibilities of the digital infrastructure in greyscale (GDIO) is said to offer a revenue stream that differs from “traditional income-oriented investments” because specified on the company website.
The company intends to purchase mining equipment, buy and sell bitcoin on a daily basis, and remit operating profits to investors every three months.
“After talking to Mike Colyer [CEO of Foundry] and the Foundry team over the crypto winter, we agreed that there is a way to engage investors directly with crypto mining,” said the Grayscale CEO Michael Sunshine said on twitter. “GDIO is the result,” he added.
Compared to its all-time high in November 2021, the price of bitcoin and other major cryptocurrencies has fallen nearly 70%, wiping out billions of dollars in investor wealth and bankrupting several large companies.
Also read: EXCLUSIVE: Kucoin in talks to buy struggling crypto companies, says CEO
Bitcoin miners were one such company, and as the value of Bitcoin fell, so did their revenue from minting new Bitcoin.
Opportunity to buy mining machines at a deep discount
With mining currently less profitable than it used to be, a key part of GDIO’s investment thesis is the ability to purchase bitcoin mining equipment at heavily discounted prices.
The company is betting that Bitcoin will eventually see a price spike as part of a four-stage mining cycle called “Rising Bull,” “Mining Gold Rush,” “Inventory Flush,” and “Shakeout.”
Grayscale claimed that the mining cycle has now entered the “inventory flush” phase, during which the hash rate is still high, but the price of bitcoin has dropped…
