As filed with the Securities and Exchange Commission on November 13, 2025

Registration No. 333-

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM S-1

REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

Grayscale Investments, Inc.

(Exact Name of Registrant as Specified in Its Charter)


Delaware	6221	39-2149041
(State or Other Jurisdiction of Incorporation or Organization)	(Primary Standard Industrial Classification Code Number)	(I.R.S. Employer Identification Number)
	290 Harbor Drive, 4th Floor Stamford, Connecticut 06902 (212) 668-1427
(Address, Including Zip Code, and Telephone Number, Including Area Code, of Registrant’s Principal Executive Offices)


	Peter Mintzberg Chief Executive Officer Grayscale Investments 290 Harbor Drive, 4th Floor Stamford, Connecticut 06902 (212) 668-1427
(Name, Address, Including Zip Code, and Telephone Number, Including Area Code, of Agent For Service)

       
      Copies to:

      Joseph A. Hall
Daniel P. Gibbons
Davis Polk & Wardwell LLP
450 Lexington Avenue
New York, New York 10017
(212) 450-4000

      Craig Salm
Chief Legal Officer
Grayscale Investments
290 Harbor Drive, 4th Floor
Stamford, Connecticut 06902
(212) 668-1427

      Ryan J. Dzierniejko
Lorenzo Corte
Skadden, Arps, Slate, Meagher & Flom LLP
One Manhattan West
New York, New York 10001
(212) 735-3000

     

Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this Registration Statement.

If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. ☐

If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐ __________

If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐ __________

If this form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐ __________

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer ☐		Accelerated filer ☐
Non-accelerated filer ☒		Smaller reporting company ☐
		Emerging growth company ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. ☐

The Registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.

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The information in this prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.

SUBJECT TO COMPLETION, DATED NOVEMBER 13, 2025

PRELIMINARY PROSPECTUS

Class A common stock
$ per share

We are offering shares of our Class A common stock. This is our initial public offering and no public market exists for our Class A common stock. We anticipate that the initial public offering price of our Class A common stock will be between $ and $ per share.

Upon completion of this offering, we will have two classes of common stock: Class A common stock and Class B common stock. The Class A common stock offered hereby will have one vote per share and economic rights and, subject to the Voting Limitation (as defined herein), the Class B common stock will have ten votes per share but no economic rights. Upon completion of this offering, the Pre-IPO LLC Members (as defined herein), controlled by Digital Currency Group, Inc. (“DCG”), our controlling shareholder, will hold shares of Class A common stock and Class B common stock that in the aggregate will entitle them to % of the combined voting power of our common stock (or % if the underwriters exercise their option to purchase additional shares of Class A common stock in full). As a result, DCG will be able to control any action requiring the general approval of our stockholders, including the election of our board of directors, the adoption of amendments to our certificate of incorporation and bylaws and the approval of any merger or sale of the Company or substantially all of our assets. As a result, we will be a “controlled company” within the meaning of the New York Stock Exchange (“NYSE”) rules. See “Management—Controlled Company Exemption” and “Risk Factors—Risk Factors Related to Ownership of Our Class A Common Stock and This Offering—Following the completion of this offering, we will be a ‘controlled company’ as defined under the corporate governance rules of the NYSE, and as a result, will qualify for, and rely on, exemptions from certain corporate governance requirements of the NYSE.”

We are a holding company, and our principal asset is our ownership interests in Grayscale Operating, LLC. As the sole managing member of Grayscale Operating, LLC, we operate and control all of the business and affairs of Grayscale Operating, LLC and, through Grayscale Operating, LLC and its subsidiaries, conduct our business. See “Organizational Structure.”

We will use all of the net proceeds we receive from this offering to purchase membership interests of Grayscale Operating, LLC, which we refer to as “LLC Units,” from the Pre-IPO LLC Members, at a price for each LLC Unit equal to the initial public offering price of our Class A common stock after underwriting discounts and commissions. See “Use of Proceeds.” Grayscale Operating, LLC will not receive any proceeds from the sale of LLC Units by the Pre-IPO LLC Members to us.

This offering is being conducted through what is commonly referred to as an “Up-C” structure.

We have applied to list our Class A common stock on the NYSE under the symbol “GRAY.”

Investing in our Class A common stock involves risks. See “Risk Factors” beginning on page 23.

We are an “emerging growth company” as defined in the Jumpstart Our Business Startups Act and will therefore be subject to reduced reporting requirements. See “Prospectus Summary—Implications of Being an Emerging Growth Company.”

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Neither the Securities and Exchange Commission (the “SEC”) nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.


	Per Share	Total
Public offering price	$	$
Underwriting discounts and commissions(1)	$	$
Proceeds to Grayscale before expenses	$	$

(1)

We have agreed to reimburse the underwriters for certain Financial Industry Regulatory Authority-related expenses. See “Underwriters.”

At our request, the underwriters have reserved up to shares of our Class A common stock, or % of the shares offered in this offering, for sale at the initial public offering price through a directed share program to certain eligible investors in our Grayscale Bitcoin Trust ETF (“GBTC”) and our Grayscale Ethereum Trust ETF (“ETHE”) and certain individuals identified by our officers and directors. See “Underwriters—Directed Share Program.”

We have granted the underwriters the right to purchase up to an additional shares of our Class A common stock at the initial public offering price, less the underwriting discounts and commissions. The underwriters may exercise this option solely for the purpose of covering over-allotments, if any, made in connection with the offering of the shares of our Class A common stock offered by this prospectus.

The underwriters expect to deliver the shares to purchasers on or about , 2025.


Morgan Stanley	BofA Securities	Jefferies	Cantor

      Wells Fargo Securities

      Canaccord Genuity

      Piper Sandler

      Keefe, Bruyette & Woods
A Stifel Company

      Needham & Company

       
      Benchmark
A StoneX Company

      Compass Point

, 2025


		Page
Founder’s Letter		ii
Prospectus Summary		1
Risk Factors		23
Special Note Regarding Forward-Looking Statements		84
Organizational Structure		86
Use of Proceeds		91
Dividend Policy		92
Capitalization		93
Unaudited Pro Forma Condensed Consolidated Financial Information		95
Dilution		104
Management’s Discussion and Analysis of Financial Condition and Results of Operations		106
Business		131
Management		160
Executive and Director Compensation		164
Certain Relationships and Related Person Transactions		175
Principal Stockholders		181
Description of Capital Stock		183
Material U.S. Federal Tax Considerations for Non-U.S. Holders of Common Stock		190
Shares Eligible for Future Sale		193
Underwriters		195
Legal Matters		202
Experts		202
Where You Can Find More Information		202
Index to Consolidated Financial Statements		F-1

We and the underwriters have not authorized anyone to provide any information or to make any representations other than those contained in this prospectus or in any free writing prospectuses we have prepared. We and the underwriters take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may provide you. We and the underwriters are offering to sell, and seeking offers to buy, shares of Class A common stock only in jurisdictions where offers and sales are permitted. The information contained in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus or of any sale of the shares of Class A common stock.

For investors outside the United States: we and the underwriters have done nothing that would permit this offering or possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than in the United States. Persons outside of the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, this offering of the shares of our Class A common stock and the distribution of this prospectus outside of the United States.

Until , 2026, all dealers that buy, sell or trade our shares of Class A common stock, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to the dealers’ obligation to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions.

BASIS OF PRESENTATION

On January 1, 2025, we completed the Pre-IPO Reorganization described under “Organizational Structure—The Pre-IPO Reorganization,” pursuant to which, among other things, Grayscale Investments, LLC merged with and into Grayscale Operating, LLC, with Grayscale Operating, LLC surviving the merger. The Pre-IPO Reorganization was treated as a reorganization of companies under common control and has been accounted for as a change in reporting entity between entities under common control, as each entity was controlled by DCG. Accordingly, Grayscale Operating, LLC’s consolidated financial statements included in this prospectus as of and for the years ended December 31, 2024 and 2023 have been presented giving retroactive effect to the Pre-IPO Reorganization in accordance with Accounting Standards Codification (“ASC”) 250-10-45-21.

Grayscale Investments, Inc. (formerly known as GSO Intermediate Holdings I Corporation) was formed as a Delaware corporation on May 2, 2025 and, prior to the closing of the Private Placement (as defined herein) on October 22, 2025, had not conducted any activities other than those incidental to its formation, the Private Placement, the Private Placement Reorganization (as defined herein), the IPO Reorganization, and the preparation of this prospectus and the registration statement of which this prospectus forms a part. In connection with the closing of the Private Placement, we completed the Private Placement Reorganization pursuant to which GSO Intermediate Holdings I Corporation was renamed to Grayscale Investments, Inc. and became the holding company of Grayscale Operating, LLC. Following the Private Placement Reorganization, Grayscale Investments, Inc.’s principal asset is its ownership interests in Grayscale Operating, LLC. See “Organizational Structure—Private Placement Reorganization.” Upon completion of the Private Placement Reorganization, Grayscale Operating, LLC became the predecessor of Grayscale Investments, Inc. for financial reporting purposes.

In this prospectus, unless the context otherwise requires, “Grayscale,” the “Company,” “we,” “us” and “our” refer (i) prior to the consummation of the Pre-IPO Reorganization described under “Organizational Structure—The Pre-IPO Reorganization,” to Grayscale Investments, LLC and its subsidiaries, (ii) after the Pre-IPO Reorganization and prior to the consummation of the Private Placement Reorganization described under “Organizational Structure—Private Placement Reorganization,” to Grayscale Operating, LLC and its subsidiaries, and (iii) after the Private Placement Reorganization described under “Organizational Structure—Private Placement Reorganization,” to Grayscale Investments, Inc. and its subsidiaries. Unless otherwise stated or the context otherwise requires, all information in this prospectus reflects the consummation of the Private Placement Reorganization and the IPO Reorganization.

MARKET AND INDUSTRY DATA

This prospectus includes industry and market data that we obtained from periodic industry publications, third-party studies and surveys, filings of public companies in our industry, and internal company surveys. These sources include government and industry sources. Industry publications and surveys generally state that the information contained therein has been obtained from sources believed to be reliable. Although we believe the industry and market data to be reliable as of the date of this prospectus, this information could prove to be inaccurate. Industry and market data could be wrong because of the method by which sources obtained their data and because information cannot always be verified with complete certainty due to the limits on the availability and reliability of raw data, the voluntary nature of the data gathering process, and other limitations and uncertainties. In addition, we do not know all of the assumptions regarding general economic conditions or growth that were used in preparing the forecasts from the sources relied upon or cited herein. Such data and assumptions, including those relating to a specified market’s projected growth or future performance, are necessarily subject to a high degree of uncertainty and risk due to a variety of factors, including those described in “Risk Factors.” These and other factors could cause future performance to differ materially from such data and estimates. See “Special Note Regarding Forward-Looking Statements.”

TRADEMARKS AND TRADE NAMES

We own or have rights to trademarks, service marks, and trade names that we use in connection with the operation of our business. Other trademarks, service marks, and trade names appearing in this prospectus are the property of their respective owners. Solely for convenience, some of the trademarks, service marks, and trade names referred to in this prospectus are listed without the ® or ™ symbols, but we will assert, to the fullest extent under applicable law, our rights to our trademarks, service marks, and trade names.

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NON-GAAP FINANCIAL MEASURES

This prospectus contains non-GAAP financial measures, including Adjusted Operating Income and Adjusted Net Income, which are financial measures that are not calculated and presented in accordance with U.S. generally accepted accounting principles (“GAAP”). See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Non-GAAP Financial Measures” for our definitions of these non-GAAP measures, information about how and why we use these non-GAAP measures, and a reconciliation of each of these non-GAAP measures to its most directly comparable financial measure calculated in accordance with U.S. GAAP.

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Prospectus Summary

This summary highlights information contained elsewhere in this prospectus. This summary may not contain all of the information that you should consider before deciding to invest in our Class A common stock. You should read this entire prospectus carefully, including the “Risk Factors,” “Special Note Regarding Forward-Looking Statements,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Business” sections and the consolidated financial statements and the notes to those statements.

Grayscale Overview

Grayscale is the largest digital asset-focused investment platform in the world, with approximately $35 billion in assets under management as of September 30, 2025. Our mission is to make digital asset investing simple and open to every investor. Founded in 2013, we have pioneered regulated access to the digital asset class. Our platform spans the full spectrum of institutional-grade solutions, providing investors with the broadest and most diverse suite of digital asset-focused investment products in the United States based on number of products. Today, we are operating from a position of strength due to our highly differentiated position in the digital asset investment ecosystem:

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We believe that Grayscale is the smart way to invest in the digital asset class, just as investing in our products is a smart way to invest in digital assets. The inherent operating leverage underlying our platform has the potential to deliver superior returns relative to digital assets when market values appreciate, while also providing us the flexibility to maintain financial discipline, control costs and opportunistically invest in our growth initiatives should digital asset prices depreciate for sustained periods of time. When compared with the other options investors have to gain digital asset exposure via the public markets, we believe Grayscale offers (1) better diversification than stablecoin issuers due to our comprehensive coverage of the digital asset universe rather than single sector exposure, (2) better capital efficiency than miners due to our lower operating expenses, (3) better economics than digital asset trading platforms because our revenues are derived from more stable management fees on AUM rather than transaction fees, and (4) better return on equity than treasury companies with less risk because our profitable and capital-efficient operating business model can, but does not need to, issue debt or dilutive equity to generate returns. We also have the ability to organically and efficiently compound our exposure to digital assets by accruing tokens through our asset management business, allowing us to retain operating profit in the form of digital assets and further participate in the potential growth of the market.

Pioneering the Digital Asset Revolution

Digital assets and blockchain technology are driving a secular shift in the global financial system, streamlining financial access and democratizing payment rails. Recognizing this transformative potential, we knew investors would need regulated investment vehicles that provide transparent, compliant and secure access. In 2013, we launched the first widely available and institutional-grade Bitcoin investment fund in the world—then known as the “Bitcoin Investment Trust”—to meet this market demand.

Grayscale was the first firm in history to offer a product of this kind, pioneering regulated access to the digital asset class. Our groundbreaking Bitcoin product offered U.S. accredited investors a familiar investment vehicle to gain exposure to the first and largest digital asset protocol in existence. We would go on to make our Bitcoin product the first publicly traded Bitcoin vehicle under the ticker GBTC, the first SEC reporting digital asset investment vehicle, and among the first spot Bitcoin exchange-traded products following our watershed U.S. Court of Appeals ruling in 2023.

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Our Bitcoin trust was introduced when Bitcoin had a market capitalization of only approximately $1.5 billion. As of September 30, 2025, the entire digital asset market capitalization is nearly 3,000 times that at approximately $4 trillion. Comparing digital asset market capitalization from September 30, 2024 to September 30, 2025, the asset class has grown approximately 71%.

Since the launch of our Bitcoin trust, we have become deeply embedded within the digital asset investment ecosystem. Through our Capital Solutions Platform—an origination engine through which we partner with entrepreneurs, developers, foundations and protocol teams—we structure products and solutions around what we believe are the most promising emerging technologies. What began with Bitcoin has grown into an entire universe of digital asset sectors including artificial intelligence (“AI”), identity systems, digital artwork, storage, web hosting and gaming. Digital assets are reshaping traditional finance through the tokenization of real-world assets—such as stocks, bonds, real estate, and commodities—and stablecoins have emerged as one of the most prominent use cases of the asset class, removing friction and driving efficiency in payment systems infrastructure.

As digital assets reshape the future of finance, Grayscale is not just participating in the asset class, we are helping unlock its true potential by inventing products and pioneering regulated access for investors. We are doing for digital assets what Vanguard and PIMCO did for the investment management industry with their mutual fund and bond fund in the 1970s and 1980s, and what KKR did for private equity with their leveraged buy-out vehicles in the 1980s.

Our History of Firsts

•

2013: Launched the world’s first widely available Bitcoin investment vehicle (Bitcoin Investment Trust, later GBTC)

•

2015: GBTC became the first publicly traded Bitcoin fund

•

2017: Introduced the first widely available Ethereum investment vehicle (ETHE)

•

2019: ETHE became the first publicly traded Ethereum fund

•

2021: Brought the first SEC-reporting digital asset vehicles to market (GBTC and ETHE)

•

2023: Landmark court victory paving the way for the approval of the first spot Bitcoin ETPs

•

2024: Launched one of the first Bitcoin ETPs and one of the first Ethereum ETPs

•

2024: Launched Bitcoin and Ethereum “Mini Trusts” (Ticker: BTC and Ticker: ETH), the lowest-cost ETPs in the U.S. market

•

2025: Within its first year, BTC surpassed $5 billion in AUM—a milestone achieved by only nine other ETF products

•

2025: Launched the first diversified digital asset ETP encompassing multiple digital asset tokens beyond Bitcoin and Ethereum (Ticker: GDLC)

•

2025: Launched the first Ethereum staking ETPs (Ticker: ETHE and Ticker: ETH)

Our Market Opportunity

Digital assets are among the fastest-growing asset class of the past decade and now represent a multi-trillion-dollar sector, making it an attractive opportunity for investors. We believe digital assets have reached escape velocity and are poised to further revolutionize traditional financial markets as they gain greater institutional adoption and regulatory clarity to unlock their potential.

Massively Expanding Market

Grayscale has been a pioneer in this massively expanding market and is now working to capitalize on the opportunities that lie ahead. The market capitalization of digital assets as of September 30, 2025 was approximately $4 trillion, according to data from CoinGecko. For comparison, the private credit market, another fast-growing asset class, was approximately $2 trillion at year-end 2024, according to Preqin. Digital assets are the fastest-growing asset class in recent history as compared to other major asset classes, including U.S. equities, gold and U.S. corporate bonds. Using Bitcoin as a proxy for digital assets, from September 30, 2015 to September 30, 2025, the price of Bitcoin increased more than 47,800% per CoinGecko. Comparatively over the same time period, the S&P 500 (per S&P Capital IQ), gold (per S&P Capital IQ), U.S. bonds (as measured by the Bloomberg U.S. Aggregate Total Return Value Unhedged USD Index) and U.S. treasuries (as measured by the BlackRock U.S. iShares Treasury Bond ETF) increased 248%, 245%, 20% and 12%, respectively.

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We estimate our total addressable market capitalization is approximately $4 trillion as of September 30, 2025, and we believe that it has potential to grow further. We define our total addressable market today as the market capitalization of all digital assets and our serviceable addressable market as the total amount of capital invested in digital assets through investment vehicles such as ETFs, ETPs, private funds or trusts, publicly quoted private funds or trusts, and actively managed strategies. We estimate this serviceable market opportunity is approximately $365 billion as of September 30, 2025. To calculate this figure, we consider the total assets under management of digital asset exchange-traded products, over-the-counter digital asset investment products, digital asset futures-based funds, digital asset-exposed thematic equity funds, digital asset-exposed hedge funds, digital asset-exposed private equity or venture capital funds, digital asset-exposed private passive funds and tokenized digital asset funds. Our serviceable addressable market is based on a rigorous analysis of products offered by us and our competitors through both exchange-listed and non-exchange-listed products and funds, with data sourced from Bloomberg, Preqin and U.S. regulatory filings.

Going forward, we expect that the total addressable market will continue to grow as well as expand into adjacencies including tokenized real-world assets and other blockchain-enabled technologies. We continue to believe an increasing portion of the total addressable market will be served via regulated investment vehicles as digital asset allocations evolve, positioning Grayscale to deliver growth. In particular, we expect that institutional adoption and advised wealth portfolios will drive inflows into digital asset ETFs and ETPs, popular products that provide robust and regulated investor access and represent a large addressable market compared to other vehicle structures.

Increasing Institutional Adoption

We continue to see investors indicate a growing interest in increasing their exposure to the digital asset investment ecosystem. 83% of institutional investors expect to increase their digital asset allocations in 2025, with 59% expecting to allocate more than 5% of their portfolio to digital assets, according to an independent survey conducted by Ernst & Young.

There is also a shift in investor preference towards digital assets across wealth management channels. Morgan Stanley’s Wealth Management Global Investment Committee in an October 2025 report recommended a digital asset allocation of up to 4% across client portfolios oriented towards opportunistic growth. The proportion of financial advisors recommending allocations toward digital assets for all clients has more than doubled from 8% as of March 2024 to 20% as of December 2024, according to a survey of financial advisors conducted by the Digital Assets Council of Financial Professionals. In addition, 65% of financial advisors have recommended some digital asset allocation to at least 10% of their clients, and more than a third of financial advisors recommend digital asset allocations to at least 50% of their clients. The White House issued Executive Order 14330, titled “Democratizing Access to Alternative Assets for 401(k) Investors,” which aims to expand the range of investment options available to participants in 401(k)s. We believe this will further increase portfolio allocations by allowing the larger than $13 trillion defined contribution plan market, which consists of the larger than $9 trillion 401(k) market, as of June 30, 2025, to invest in digital assets. We expect continued growth in allocations from advised wealth channels as education, awareness, and regulation around digital assets mature.

As digital asset investing penetrates these previously inaccessible, more traditional investment channels, we expect that sophisticated investors will also increasingly purchase digital assets outside of Bitcoin and Ethereum. Emerging tokens provide exposure to a variety of different risk return profiles, offering investors more choice that is not well serviced by traditional asset managers. Our strong brand and existing product infrastructure allow us to go to market quickly and efficiently, positioning us to capture AUM as emerging tokens become part of diversified digital asset portfolios. Today, we have the broadest offering of digital asset-focused investment products in the U.S, with more than 40 products, providing exposure to more than 45 tokens as of September 30, 2025. Most of our competitors have a more limited range of product offerings, with many providing exposure only to Bitcoin and Ethereum.

Improving Regulatory Clarity

Digital asset adoption has gained momentum with increasing alignment across various levels of government and bipartisan lawmakers. Recent examples of key developments fostering digital asset innovation include executive orders, such as Executive Order 14178 titled “Strengthening American Leadership in Digital Financial Technology,” which established the Presidential Working Group on Digital Asset Markets with a mandate to develop a federal regulatory framework for digital assets, and the previously mentioned Executive Order 14330, titled “Democratizing Access to Alternative Assets for 401(k) Investors,” which aims to expand the range of investment options available to participants in defined contribution plans such as 401(k)s. We have also seen a significantly improved regulatory posture, such as the SEC’s formation of a dedicated Crypto Task Force, approval of Generic Listing Standards for Commodity-Based Digital Asset Trusts, announcement of “Project Crypto,” and decision to drop or pause effectively all of its non-fraud related lawsuits and/or investigations against leading digital asset market participants and protocol development teams. More recently, legislative policy has been making its way through Congress that has the potential to bolster the digital asset industry for the long term, including the enactment of the Guiding and Establishing National Innovation for U.S. Stablecoins Act (the “GENIUS Act”) and the U.S. House passage of the Digital Asset Market Clarity Act (the “Clarity Act”). We believe this increased regulatory clarity will enable us to offer more innovative products with more diversified assets to further unlock investor demand and grow AUM.

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Unlocking Digital Asset Features

Digital assets have unique features. We believe one of the most prominent examples is staking, an activity with no direct parallel in traditional asset classes. By participating in staking, holders of certain digital assets help secure blockchain networks like Ethereum and Solana, and in return, earn protocol-level rewards for doing so. This mechanism not only enhances network integrity but also enables value creation directly from asset ownership. As of September 30, 2025, we manage one of the largest Ethereum ETP franchises globally, with approximately $7.4 billion in assets under management. In October 2025, after years of advocating for regulatory approval to enable staking, we were the first to stake in Ethereum ETPs. Based on the average annualized staking reward rate of approximately 3% on the Ethereum protocol, we have unlocked substantial value for our shareholders and investors. Additionally, our large scale allows us to extract favorable terms from our staking service providers. We are also staking in our Solana ETP and plan to do so across all of our stakeable investment vehicles as the regulatory environment permits, potentially unlocking further value for shareholders and investors.

Our Growth Opportunities

Our platform spans the full spectrum of institutional-grade solutions, providing investors with the broadest and most diverse suite of digital asset-focused investment products in the United States based on number of products. This platform provides us with multiple growth vectors to capitalize on our market opportunity, including our “Growth” products and other initiatives. We define our “Growth” products as all products other than GBTC and ETHE, which consist of our Bitcoin and Ethereum “Mini Trusts” (Ticker: BTC and Ticker: ETH), the lowest-cost ETPs in the U.S. market, alternative ETPs, ETFs and Private Funds. As of September 30, 2025, we have seen cumulative inflows of approximately $3.7 billion in our Growth products since January 2024. As the digital asset investing market grows and evolves, we believe we are well positioned to continue growing organically through the following strategies:

Build on the Success of Our ETF and ETP Suite

Transition to ETFs and ETPs. ETFs and ETPs are popular products that provide robust and regulated investor access and represent a large addressable market compared to other vehicle structures. We have converted our Bitcoin, Ethereum, Solana and diversified digital asset products to ETPs and plan to do so for our other products to allow for broader investor access and further AUM growth. ETFs and ETPs are the predominant vehicle for advisor platforms that serve U.S. high net worth investors. Our ETFs and ETPs are already approved on major advisor platforms, positioning us to capture rising allocations from these investors. There is a first-mover advantage to launching ETFs and ETPs because existing scale tends to reinforce additional investor flows, and we believe Grayscale is well positioned to capture that advantage for emerging tokens as we have done for Bitcoin and Ethereum. Further, recent regulatory developments are also shortening approval timelines and have begun to permit more sophisticated underlying assets and structures, including multi-asset and staking-enabled ETPs, creating opportunity for incremental revenue and diversifying investor product choice in the sector. Together, these factors position us to extend the success of our flagship ETFs and ETPs and further solidify our leadership position in offering regulated digital asset-focused investment products. As of September 30, 2025, we have experienced approximately $3.3 billion of cumulative net inflows in our ETFs and ETPs (excluding GBTC and ETHE) since the beginning of 2024.

Launch of Mini Products. In July 2024, we launched our Bitcoin and Ethereum “Mini Trusts” (Ticker: BTC and Ticker: ETH), the lowest-cost ETPs in the U.S. market. These products were launched with advised wealth distribution channels in mind and offer fee rates of 0.15%. AUM in these products has grown to $8.5 billion as of September 30, 2025. We expect that this growth will continue as we are added to more advised wealth platforms over time.

Launch of GDLC and Multi-Token Offerings. In September 2025, we were the first to launch a diversified digital asset ETP encompassing multiple tokens beyond Bitcoin and Ethereum (Ticker: GDLC). As digital asset investing matures, we believe demand will become more sophisticated. Bitcoin and Ethereum have been attractive entry points to digital assets, but we expect investor demand will expand to tokens beyond Bitcoin and Ethereum. We launched our GDLC product as a way to provide diversified digital asset exposure to multiple tokens in a single product. AUM in GDLC has grown to $741 million as of September 30, 2025.

Launch of GSOL. In October 2025, we launched Grayscale Solana Trust ETF (Ticker: GSOL) on NYSE Arca as an ETP, making it the first of our staking products to uplist under the new generic listing standards approved by the SEC. With the launch of GSOL on NYSE Arca, we are now among the largest Solana ETP managers in the United States by AUM.

Double-Down on Differentiated Strategies

Our Private Fund franchise offers accredited investors exposure to a wide array of emerging digital assets that are not yet available in a public ETF or ETP format. These Private Funds carry a fee rate that is typically 2.50%. We intend to expand our Private Fund franchise to capture growth in the broader digital asset market, particularly as projects beyond Bitcoin and Ethereum continue to gain awareness and adoption.

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Our Private Fund franchise is enabled by our Capital Solutions Platform—an origination engine through which we partner directly with entrepreneurs, developers, foundations and protocol teams. The Capital Solutions team is responsible for identifying and structuring products and solutions around what we believe are the most promising emerging technologies. This process starts with institutional-grade research that combines fundamental diligence with market intelligence to assess the long-term viability of protocols. Following the selection of high-conviction assets, we explore avenues to productize and offer exposure for investors. This process often results in the chosen protocol contributing tokens to seed a corresponding Grayscale investment product. Grayscale typically earns fees on this portion of AUM. The protocol benefits from increased visibility and access to Grayscale’s fund investors. Grayscale fund investors benefit from access to potential returns by investing in the protocol.

Expand into Active Products

We believe there is a significant opportunity to complement the passive strategies of our ETFs, ETPs and Private Funds with actively managed products that can address investor demand for alpha generation, risk management, and income strategies not achievable through passive exposures alone. Active management is well-established in traditional finance, whereas in digital assets active management remains a nascent and fragmented offering with few scaled participants. This creates an opportunity for Grayscale, as a trusted and established provider, to emerge as the category leader. We intend to leverage our balance sheet, distribution capabilities, and brand to accelerate entry into this market, including through potential partnerships or acquisitions of proven investment managers that can be integrated into our fund platform.

Establish Principal Investments

We plan to make Principal Investments that further align our interests with those of our fund investors and have the potential to generate long-term growth for our investors. We believe this initiative is a natural extension of our core business and enhances our inherent leverage to the digital asset investment ecosystem.

We intend to fund these initiatives through a combination of proceeds from the $250 million private placement of our Series A convertible preferred stock, which closed on October 22, 2025, and from retained earnings generated by our operations. In addition, as we are compensated in tokens across many of our investment products, we will actively monitor the retention and utilization of these tokens as a source of funding for our Principal Investments. This may include retaining tokens for direct deployment into strategic initiatives or converting tokens to cash to support additional investments as market conditions warrant.

Our Principal Investments may include digital asset tokens or Grayscale investment products that provide comparable exposure to such assets. This approach enables us to grow our Principal Investments both organically and efficiently, leveraging a mix of capital from traditional sources and the accumulation of digital assets derived from our business operations. We aim to optimize our balance sheet exposure to the digital asset investment ecosystem while maintaining flexibility to pursue long-term strategic opportunities that align with our investors’ interests.

Accelerate Growth Through Strategic Partnerships

We aim to expand our distribution reach and accelerate product innovation through partnerships with platforms, banks, registered investment advisors (“RIAs”), and institutional networks. These channels are often gatekeepers to significant assets that require robust and extensive due diligence to access. Having Grayscale products approved on these platforms and distribution channels positions us for meaningful inflows. We believe that these collaborations also provide opportunities for co-branded products, incentive-based fee structures, and talent acquisition that have the potential to strengthen our long-term growth.

We have completed diligence or are in the diligence process with three of the largest wirehouses in the United States, which collectively managed $14.2 trillion in AUM as of September 30, 2025. Furthermore, in November 2025, one of the largest independent broker-dealer in the United States, with more than 17,500 financial advisors and more than $1 trillion in advisory and brokerage assets, approved our Bitcoin Mini ETF (Ticker: BTC), the lowest-cost Bitcoin ETP in the U.S. market, and Grayscale Ethereum Mini ETF (Ticker: ETH), the lowest-cost Ether ETP in the U.S. market, for purchase on their brokerage and asset management platforms. With the competitive fee rates on our Bitcoin Mini ETF and Ethereum Mini ETF, we believe we are well positioned to capture flows from clients of these institutions as they elect to allocate portfolio composition to digital assets.

In addition to advised wealth channels, we have established partnerships with other product distributors and intermediaries. In August 2025, we announced a partnership with iCapital Network (“iCapital”), which has a network of approximately 6,700 advisor firms, whereby Grayscale will offer iCapital’s network advisor firms access to digital assets through our actively managed investment strategies.

We believe the continued addition of our products to wealth platforms and other partnerships we establish will continue to position us to attract meaningful inflows from these firms and their clients.

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Competitive Differentiators of Our Platform

Maintaining our position of strength is a strategic priority. We believe that the competitive differentiators that will enable our leadership in the digital asset industry to continue into the future are:

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Market-Leading Position: We are the largest digital asset-focused investment platform in the world as measured by AUM, with approximately $35 billion in assets under management as of September 30, 2025. We are the:

#1 Bitcoin investment platform in the world by revenue as compared to other sponsors of spot Bitcoin ETPs.

#1 Ethereum investment platform in the world by revenue as compared to other sponsors of spot Ethereum ETPs.

#1 alternative token investment platform in the U.S. by revenue as compared to other sponsors of Private Funds investing in spot digital assets.

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Broadest Product Offering: Our platform spans the full spectrum of institutional-grade solutions, providing investors with the broadest and most diverse suite of digital asset-focused investment products in the United States based on number of products. Our investment products include:

Private Funds: Private placement products designed to provide exposure to a rapidly evolving asset class securely and conveniently.

Publicly Traded (OTC): Publicly quoted products (which may, in select cases, become SEC-reporting products) that have transitioned from Private Funds to publicly traded vehicles.

ETFs and ETPs: Regulated, publicly traded, digital asset exposure through familiar vehicles with seamless accessibility. Our ETFs and ETPs provide investors with a variety of options, including direct token, income-focused and thematic products.

We believe our product breadth positions us to capture incremental inflows across all investor types by providing an array of strategies based on investor demand.

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Capital Solutions Platform: We have over a decade of experience building a trusted platform curated specifically for the rapidly evolving digital asset class. Through our Capital Solutions Platform—an origination engine through which we partner with entrepreneurs, developers, foundations and protocol teams—we structure products and solutions around what we believe are the most promising emerging technologies. The protocol benefits from increased visibility and access to Grayscale’s fund investors. Grayscale fund investors benefit from access to potential returns by investing in the protocol. Our scale, reputation, and trusted position within the digital asset investment ecosystem create meaningful competitive moats. We continue to strengthen and expand this platform through a growing product suite and direct distribution to our Private Fund investors.

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Trusted Brand: Grayscale has established itself as one of the most recognized and trusted brands in the digital asset investment ecosystem. According to a brand health survey commissioned by Grayscale and conducted by Whitman Insight Strategies in December 2024 sampling 1,200 investors in the United States, Grayscale’s brand awareness was approximately twice that of other digital asset-focused investment platforms, including 21Shares, Bitwise, and CoinShares. In a separate survey of independent RIAs conducted by the Financial Times in July 2024, Grayscale ranked second among asset managers RIAs would consider working with. We believe our strong brand position reflects our digital-native investment expertise and our sustained commitment to education, transparency, and partnership across a wide spectrum of investors—from individual participants to financial advisers and institutions—as they evaluate and allocate capital within the digital asset class.

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Client Distribution and Marketing Platform: We operate one of the largest digital asset distribution platforms with a team of digital-native specialists across the country. Education and research content are at the core of our approach to distribution. This includes institutional-grade analyses, discussions with protocol founders, market commentary, thematic studies, and fund-specific reports. Our research combines fundamental analysis, due diligence, and real-time market intelligence and is utilized by a broad range of investors and capital allocators. Through our proprietary Crypto Connect event series, hosted in major U.S. wealth centers, we convene industry leaders, regulatory experts, and product specialists with capital allocators representing significant sources of wealth. Members of our team also regularly speak at leading industry conferences worldwide, sharing insights on the digital asset investment ecosystem. This hands-on, expertise-driven approach has led to prolific platform engagement, resulting in over 7,500 new investor connections via approximately 2,400 meetings and approximately 11,000 calls from March 31, 2024 to March 31, 2025. In addition, our marketing team utilizes targeted omni-channel campaigns, leveraging our proprietary client and prospect database and content to drive adoption of our investment products. This differentiated approach establishes a massive reach across marketing channels, delivering 5.2 billion total advertising impressions, as well as 46 million organic and 206 million paid impressions on social media in 2024.

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Established, Institutional-Grade Infrastructure: We have invested heavily in developing a comprehensive infrastructure that is purpose-built for digital assets. Our products are supported by institutional-grade service providers, including

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independent custodians and auditors, to ensure best-in-class safekeeping of client assets. Our internal controls, third party service providers, and risk management protocols are designed to adhere to applicable federal securities laws, tax regulations, anti-money laundering (“AML”) and know-your-customer (“KYC”) requirements, and custodial standards. We believe our regulatory track record and reputation for being first or early to market—while engaging in responsible product design that meets regulatory compliance standards—provide meaningful competitive differentiation, particularly as investors demand greater assurance, trust, and governance around digital asset exposure.

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Regulatory Leadership and Industry Advocacy: We believe regulatory engagement is essential to the long-term success of digital assets. Grayscale maintains constructive and proactive relationships with U.S. regulators, and we have demonstrated a willingness to thoughtfully and productively advocate for industry advancement. For example, after years of advocating for regulatory approval to enable staking, we were the first to stake in Ethereum ETPs. Our reputation as a constructive, responsible industry advocate sets us apart. We use our digital-native expertise to create opportunity for traditional investment structures to include digital assets. This perspective has become a key differentiator as we engage with regulators and policymakers to shape the future of digital assets.

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Proven Management Team: Our management team is a rare combination of 130 years of cumulative traditional finance experience and more than 50 years of cumulative digital asset leadership experience—bringing an institutional mindset to the digital asset industry. This convergence of capabilities positions us to deliver investment solutions and client experiences that are both institutionally robust and technologically advanced, which we believe offers a competitive edge that is difficult to replicate.

Summary Risk Factors

Our business is subject to numerous risks and uncertainties, including those highlighted in the section titled “Risk Factors” immediately following this prospectus summary. The following is a summary of the principal risks we face:

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Declines in the market prices of digital assets have in the past caused, and could in the future cause, our revenues to decrease.

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We are exposed to a concentration of assets in Bitcoin and Ether, and derive a substantial portion of our revenues from Grayscale Bitcoin Trust ETF and Grayscale Ethereum Trust ETF and, as a result, our results of operations are particularly exposed to investor sentiment toward Bitcoin, Ether and these individual trusts in particular.

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Increased competition in the digital asset investment industry, and the investment industry more generally, may cause our AUM and revenues to stagnate or decrease.

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Our Principal Investments initiative will, when implemented, result in us holding digital assets directly or through our investment products, which will expose us to all of the risks associated with digital assets.

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We may not successfully implement our Principal Investments or realize its intended benefits.

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We may be unable to develop new investment products, and the development of new investment products may expose us to additional costs or operational risks.

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If we are unable to successfully distribute our investment products, then our AUM and revenues could be adversely affected.

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If we fail to develop, maintain and enhance our brand and reputation, or if there is any negative publicity about us, our industry peers or in the digital asset industry, then our business, financial condition and results of operations may be adversely affected.

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It may be difficult to evaluate our business and future prospects due to our limited operating history, concentrated exposure and the variability of our operating results.

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The failure of a Custodian (as defined herein) to adequately safeguard the digital assets for which we offer investment products, or any disruptions to a Custodian’s services, could materially adversely affect our business and harm investors in our investment products.

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Our business depends on attracting and retaining our management team and other key personnel, the failure of which could disrupt our operations and adversely affect our business.

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Digital assets represent a new and rapidly evolving industry, and our results of operations may be materially adversely affected by the development, acceptance and adoption of Bitcoin, Ether or other digital assets.

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The prices of digital assets have experienced extreme volatility in recent periods and may continue to do so and could adversely affect our results of operations.

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Due to a lack of familiarity and some negative publicity associated with digital asset trading platforms, existing and potential customers, counterparties and regulators may lose confidence in the digital asset industry.

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Regulatory changes or actions by the U.S. Congress or U.S. federal or state agencies may lead to restrictions in the use of digital assets, mining and validating activity or the operation of digital asset networks or digital asset markets in a manner that adversely affects the prices of digital assets and our results of operations.

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Digital asset trading platforms may experience fraud, market manipulation, business failures, security failures or operational problems, which may adversely affect the prices of digital assets and, consequently, our results of operations.

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A determination that a digital asset is a “security” could adversely affect the value of that digital asset and potentially digital assets generally, and therefore adversely affect our business, financial condition and results of operations.

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A determination that a digital asset is a “security” for purposes of the federal securities laws could have adverse regulatory consequences for us and our investment products with respect to the Investment Company Act (as defined herein) and the Investment Advisers Act (as defined herein), and therefore adversely affect our business, financial condition and results of operations.

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Our process for analyzing whether or not a particular digital asset is a security or a transaction in a particular digital asset is a securities transaction for purposes of the federal securities laws may not yield results that are consistent with subsequent determinations by the SEC or federal courts, or with similar determinations made by our competitors.

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Our failure or inability to comply with government regulations could materially adversely affect our business, financial condition and results of operations.

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We are a holding company and our principal asset after completion of this offering will be our % ownership interest in Grayscale Operating, LLC and we are accordingly dependent upon distributions from Grayscale Operating, LLC to pay dividends, if any, and taxes, make payments under the Tax Receivable Agreement and pay other expenses.

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In certain circumstances, Grayscale Operating, LLC will be required to make distributions to us and the other holders of LLC Units, and the distributions that Grayscale Operating, LLC will be required to make may be substantial.

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We are controlled by DCG, whose interests in our business may be different than yours, and certain statutory provisions afforded to stockholders are not applicable to us. In addition, the dual class structure of our common stock will have the effect of concentrating voting control with DCG for the foreseeable future, which will limit the ability of our other investors to influence corporate matters, including the election of directors and the approval of any change of control transaction.

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We will be required to pay the Pre-IPO LLC Members and any other persons that become parties to the Tax Receivable Agreement for certain tax benefits we may receive, and the amounts we may pay could be significant.

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We are an “emerging growth company,” and we cannot be certain if the reduced reporting requirements applicable to emerging growth companies will make our Class A common stock less attractive to investors.

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We will be a “controlled company” as defined under the corporate governance rules of the NYSE, and as a result, will qualify for, and rely on, exemptions from certain corporate governance requirements of the NYSE.

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We may be required to make a significant payment to holders of our Convertible Preferred Stock under a make-whole provision, which could adversely affect our financial condition and results of operations.

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When available, our issuance of tokenized Class A common stock may not be accepted by the market, and because of regulatory uncertainty we may never be in a position to enable on-chain trading of tokenized shares, either of which could in turn have an adverse impact on the broader market for our Class A common stock.

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Before you invest in our Class A common stock, you should carefully consider all the information in this prospectus, including matters set forth under the heading “Risk Factors.”

The Pre-IPO Reorganization

On January 1, 2025, we consummated an internal corporate reorganization (the “Pre-IPO Reorganization”) involving the following steps:

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Grayscale Investments, LLC merged into Grayscale Operating, LLC, with Grayscale Operating, LLC surviving the merger as a wholly owned subsidiary of DCG Grayscale Holdco, LLC (“DCG Grayscale Holdco”), which in turn is wholly owned by DCG, our controlling shareholder; and

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DCG Grayscale Holdco transferred limited liability units constituting 10% common ownership interest in Grayscale Operating, LLC to GSO Intermediate Holdings Corporation (“GSOIH”), a wholly owned subsidiary of DCG Grayscale Holdco, and GSOIH became the sole managing member of Grayscale Operating, LLC.

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The Pre-IPO Reorganization was treated as a reorganization of companies under common control and has been accounted for as a change in reporting entity between entities under common control, as each entity was controlled by DCG. Accordingly, Grayscale Operating, LLC’s consolidated financial statements included in this prospectus as of and for the years ended December 31, 2024 and 2023 have been presented giving retroactive effect to the Pre-IPO Reorganization in accordance with Accounting Standards Codification (“ASC”) 250-10-45-21.

Recent Developments

Private Placement of Convertible Preferred Stock

On October 22, 2025, we completed a private placement (the “Private Placement”) of our Series A Convertible Preferred Stock, par value $0.0001 per share (the “Convertible Preferred Stock”). Pursuant to a securities purchase agreement, we issued and sold 25,000,000 shares of the Convertible Preferred Stock in the Private Placement for an aggregate purchase price of $250 million. Grayscale Investments, Inc. used the proceeds from the sale to purchase a corresponding number of Preferred Units (as defined below) from Grayscale Operating, LLC at a price per unit equal to $10, and Grayscale Operating, LLC may use a portion of the net proceeds received from the Private Placement to seed our Principal Investments, as described above under “—Our Recent Growth Drivers—Strategic Investments to Align with our Fund Investors.”

Upon the consummation of the offering to which this prospectus relates, each share of Convertible Preferred Stock will automatically convert into a number of shares of our Class A common stock equal to $10 divided by the product of (i) the initial public offering price of the shares of the Class A common stock sold in this offering and (ii) 0.92. Assuming an initial public offering price of $ per share (the midpoint of the estimated price range set forth on the cover page of this prospectus), the 25,000,000 shares of Convertible Preferred Stock will convert into shares of the Class A common stock. At the low and high end of the estimated price range set forth on the cover page of this prospectus, the 25,000,000 shares of Convertible Preferred Stock will convert into shares and shares of the Class A common stock, respectively.

Prior to this offering, holders of the Convertible Preferred Stock are entitled to receive accrued and unpaid dividends at a rate of 8.0% per annum, payable in cash on the first day of each calendar quarter, beginning on January 1, 2026, and upon the closing of this offering.

In connection with the Private Placement, we entered into an investors’ rights agreement (the “Investors’ Rights Agreement”), pursuant to which we granted the holders of Convertible Preferred Stock the right to receive a “make-whole” payment following the consummation of this offering under certain conditions. Whether we are obligated to pay the make-whole and the size of any such make-whole payment are primarily dependent on the trading price of the shares of our Class A common stock during the Make-Whole Reference Period (as defined herein), which is expected to be the 40 trading days beginning approximately seven months after the closing of this offering, as compared to the initial public offering price of the shares of the Class A common stock sold in this offering. If the volume-weighted average trading price of the shares of our Class A common stock during the Make-Whole Reference Period is less than the initial public offering price of the shares of the Class A common stock sold in this offering, then investors under the Investors’ Rights Agreement will likely be entitled to a make-whole payment in cash, and such payment may be significant. See “Certain Relationships and Related Person Transactions—Investors’ Rights Agreement” and “Risk Factors—We may be required to make a significant payment to holders of our Convertible Preferred Stock under a make-whole provision, which could adversely affect our financial condition and results of operations.”

In addition, the Investors’ Rights Agreement provides holders of the Convertible Preferred Stock certain customary demand and piggyback registration rights with respect to the shares of Class A common stock issuable upon the automatic conversion of Convertible Preferred Stock in connection with this offering. See “Certain Relationships and Related Person Transactions—Investors’ Rights Agreement.‎”‎

The Private Placement Reorganization

In connection with the Private Placement, we entered into the following series of transactions to implement an internal corporate reorganization, which we collectively refer to as the “Private Placement Reorganization”:

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GSO Intermediate Holdings I Corporation was renamed to Grayscale Investments, Inc.;

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Grayscale Investments, Inc.’s certificate of incorporation was amended to authorize the issuance of (i) two classes of common stock: Class A common stock and Class B common stock, which we refer to collectively as our “common stock” and (ii) the Convertible Preferred Stock. Each share of Class A common stock is entitled to one vote per share on all matters submitted to a vote of our stockholders and is entitled to economic rights. Each share of Class B common stock is entitled to a maximum of ten votes per share on all matters submitted to a vote of our stockholders, but is subject to a ratable cutback of votes to the extent necessary to ensure that the outstanding shares of Class B common stock, in the aggregate, are entitled to no more than 70% of the total number of votes to which the shares of our Class A common stock and Class B common stock are entitled. The shares of Class B common stock are not entitled to any economic rights;

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The LLC Agreement of Grayscale Operating, LLC was amended and restated to, among other things, (i) appoint Grayscale Investments, Inc. as the sole managing member of Grayscale Operating, LLC and (ii) establish the designations, preferences and rights of preferred units (the “Preferred Units”) of Grayscale Operating, LLC. The economic interests attributable to the Preferred Units are substantially identical to the economic rights of the Convertible Preferred Stock;

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Grayscale Investments, Inc. used the proceeds from the sale of the 25,000,000 shares of Convertible Preferred Stock in the Private Placement to purchase from Grayscale Operating, LLC 25,000,000 Preferred Units at a price per unit equal to $10, the same price per share at which the Convertible Preferred Stock were sold in the Private Placement;

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GSOIH contributed 3,006,000 LLC Units, representing a 3.34% ownership interest in the LLC Units, to Grayscale Investments, Inc. in exchange for an equal number of shares of Class A common stock;

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Grayscale Investments, Inc. issued and sold 86,994,000 shares of the Class B common stock to GSOIH at a price per share of $0.0001, corresponding to the 86,994,000 LLC Units held collectively by GSOIH and DCG Grayscale Holdco;

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GSOIH distributed to DCG Grayscale Holdco 81,000,000 shares of the Class B common stock corresponding to the 81,000,000 LLC Units, representing a 90% ownership interest in the LLC Units, held by DCG Grayscale Holdco;

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The GSOIH Omnibus Incentive Plan was assumed by Grayscale Investments, Inc., and outstanding equity awards with respect to shares of GSOIH Class A common stock outstanding under the GSOIH Omnibus Incentive Plan were converted, on a one-for-one basis, into awards with respect to shares of Class A common stock of Grayscale Investments, Inc.;

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Grayscale Investments, Inc. entered into a Tax Receivable Agreement with the Pre-IPO LLC Members (as defined herein) that obligates us to make payments ‎to the Pre-IPO LLC Members and any future party to the Tax Receivable Agreement ‎generally equal to 85% of the applicable cash savings that we actually realize as a result of ‎certain tax basis adjustments resulting from the purchase of LLC Units from the Pre-IPO LLC ‎Members in connection with or after this offering, future taxable redemptions or exchanges of ‎LLC Units by the holders of LLC Units and from payments made under the Tax Receivable ‎Agreement. We will retain the benefit of the remaining 15% of these tax savings;‎

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Grayscale Investments, Inc. and the holders of the Convertible Preferred Stock entered into the Investors’ Rights Agreement. ‎See “Certain Relationships and Related Person Transactions—Investors’ Rights Agreement” for more information;‎ and

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As sole managing member of Grayscale Operating, LLC, Grayscale Investments, Inc. has sole authority to (a) determine the amount and timing of distributions (other than tax distributions) from Grayscale Operating, LLC and (b) offer LLC Units to future members. ‎Because we manage and operate the business and control the strategic decisions and ‎day-to-day operations of Grayscale Operating, LLC and also have a financial interest ‎in Grayscale Operating, LLC, we consolidate the financial results of Grayscale Operating, LLC, and a ‎portion of our net income is allocated to non-controlling interest to reflect the entitlement ‎of the Pre-IPO LLC Members to a portion of Grayscale Operating, LLC’s net income. In addition, ‎because Grayscale Operating, LLC is under the common control of DCG ‎before and after the Private Placement Reorganization, we have accounted for the Private Placement Reorganization as a reorganization of entities under common control and have initially measured ‎the interests of the Pre-IPO LLC Members in the assets and liabilities of Grayscale Operating, LLC at ‎their carrying amounts as of the date of the completion of the Private Placement Reorganization.

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The diagram below depicts our organizational structure immediately following the Private Placement Reorganization. This chart is provided for illustrative purposes only and does not purport to ‎represent all legal entities within our organizational structure.

Organizational Structure

Grayscale Investments, Inc. will be the issuer of the Class A common stock offered hereby. We currently conduct our business through Grayscale Operating, LLC and its subsidiaries. All of Grayscale Operating, LLC’s outstanding equity interests are currently owned by the following persons and entities (other than those equity interests owned by us), to whom we refer collectively as the “Pre-IPO LLC Members” and which are both controlled by DCG:

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DCG Grayscale Holdco; and

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GSOIH.

In connection with this offering, we intend to enter into the following series of transactions to implement an internal reorganization, which we collectively refer to as the “IPO Reorganization”:‎

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Grayscale Investments, Inc.’s certificate of incorporation will be amended to increase the aggregate authorized share capital to shares and to make certain other changes. See “Description of Capital Stock”;

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The LLC Agreement of Grayscale Operating, LLC will be amended and restated (the “Amended LLC Agreement”) prior to this offering. Under the Amended LLC Agreement, all current and future holders of LLC Units, including the Pre-IPO LLC Members, will ‎have the right, from and after the completion of this offering, to require Grayscale Operating, LLC to ‎redeem all or a portion of their LLC Units for, at our election, newly issued shares of Class A ‎common stock on a one-for-one basis or a cash payment equal to the volume-weighted ‎average market price of one share of our Class A common stock for each LLC Unit redeemed ‎‎(subject to customary adjustments, including for stock splits, reverse splits, stock dividends and ‎other similar events affecting the Class A common stock) in accordance with the terms of the Amended LLC Agreement (the ‎‎“Redemption Right”). Additionally, in the event of a redemption request by a holder of LLC ‎Units, we may, at our option, effect a direct exchange of cash or Class A common stock for ‎LLC Units in lieu of such a redemption. A corresponding number of shares of Class B common ‎stock will be canceled on a one-for-one basis if we, following a redemption request of a holder ‎of LLC Units, redeem or exchange LLC Units of such holder of LLC Units pursuant to the ‎terms of the Amended LLC Agreement. See “Certain Relationships and Related Person ‎Transactions—Amended LLC Agreement.” Except for transfers to us pursuant to the ‎Amended LLC Agreement or to certain permitted transferees, the holders of LLC Units are not ‎permitted to sell, transfer or otherwise dispose of any LLC Units or shares of Class B common ‎stock;

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Grayscale Investments, Inc. and the Pre-IPO LLC Members will enter into the Stockholders Agreement, ‎which will, among other things, (i) provide that, for so long as the Pre-IPO LLC Members beneficially hold shares of common stock representing at least % of the combined voting power of our common stock, approval by the Pre-IPO LLC Members will be required for certain ‎corporate actions and (ii) grant the Pre-IPO LLC Members certain director nomination rights. See “Certain Relationships and Related Person ‎Transactions—Stockholders Agreement”;

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Grayscale Investments, Inc. will issue shares of Class A common stock to the public pursuant to ‎this offering;‎

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Grayscale Investments, Inc. will use all of its net proceeds from this offering (including net proceeds received if the underwriters exercise their option to purchase additional shares of Class A common stock in full) to acquire LLC Units from the Pre-IPO LLC Members (or LLC Units if the underwriters exercise their option to purchase additional shares of Class A common stock in full), at a purchase price per LLC Unit equal to the initial public offering price of Class A common stock after underwriting discounts and commissions, and an equal number of shares of Class B common stock will be forfeited by the Pre-IPO LLC Members to Grayscale Investments, Inc. and canceled immediately thereafter; and

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Upon the consummation of this offering, the 25,000,000 shares of the Convertible Preferred Stock will automatically convert into shares of our Class A common stock (assuming an initial public offering price of $ per share, which is the midpoint of the estimated price range set forth on the cover page of this prospectus), and the 25,000,000 Preferred Units of Grayscale Operating, LLC owned by Grayscale Investments, Inc. will automatically convert into LLC Units at the same conversion rate that the Convertible Preferred Stock converts into Class A common stock.

The diagram below depicts our organizational structure immediately following the IPO Reorganization, this offering and the application of the net proceeds from this offering, assuming no exercise of the underwriters’ option to purchase additional shares. This chart is provided for illustrative purposes only and does not purport to represent all legal entities within our organizational structure.

Acquisitions by Grayscale Investments, Inc. of LLC Units from the Pre-IPO LLC Members in connection with this offering and future taxable redemptions or exchanges by the Pre-IPO LLC Members of LLC Units for shares of our Class A common stock or cash are expected to produce tax basis adjustments to the assets of Grayscale Operating, LLC that will be allocated to us and thus produce favorable tax attributes. These tax attributes would not be available to us in the absence of those transactions. In connection with the Private Placement Reorganization, we entered into the Tax Receivable Agreement that obligates us to make payments to the Pre-IPO LLC Members and any future party to the Tax Receivable Agreement generally equal to 85% of the applicable cash savings that we actually realize as a result of these tax attributes and tax attributes resulting from payments made under the Tax Receivable Agreement. We will retain the benefit of the remaining 15% of these tax savings. See “Organizational Structure—Holding Company Structure and the Tax Receivable Agreement.”

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Implications of Being an Emerging Growth Company

As a company with less than $1.235 billion (as adjusted for inflation pursuant to SEC rules from time to time) in revenue during our last fiscal year, we qualify as an “emerging growth company” under the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). An emerging growth company may take advantage of reduced reporting requirements and is relieved of certain other significant requirements that are otherwise generally applicable to public companies. As an emerging growth company:

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we may present as few as two years of audited financial statements and two years of related management’s discussion and analysis of financial condition and results of operations in this prospectus;

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we will be exempt from the requirement to obtain an attestation report from our auditors on management’s assessment of our internal control over financial reporting under the Sarbanes-Oxley Act of 2002 for up to five years following the completion of this offering or until we no longer qualify as an emerging growth company;

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we are permitted to provide reduced disclosure regarding our executive compensation arrangements pursuant to the rules applicable to smaller reporting companies, which means we do not have to include a compensation discussion and analysis and certain other disclosures regarding our executive compensation; and

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we are not required to hold non-binding advisory votes on executive compensation.

In addition to the relief described above, the JOBS Act permits us an extended transition period for complying with new or revised accounting standards affecting public companies. We have elected to use this extended transition period, which means that our consolidated financial statements may not be comparable to the financial statements of public companies that comply with such new or revised accounting standards on a non-delayed basis.

In this prospectus we have elected to take advantage of some or all of these reduced disclosure requirements, and in the future, we may take advantage of any or all of these exemptions for so long as we remain an emerging growth company. We will remain an emerging growth company until the earliest of (i) the end of the fiscal year during which we have total annual gross revenue of $1.235 billion (as adjusted for inflation pursuant to SEC rules from time to time) or more, (ii) the end of the fiscal year following the fifth anniversary of the completion of this offering, (iii) the date on which we have, during the previous three-year period, issued more than $1.0 billion in non-convertible debt or (iv) the date on which we are deemed to be a “large accelerated filer” under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), which would occur if the market value of our common stock held by non-affiliates exceeded $700.0 million as of the last business day of the second fiscal quarter of such year.

Digital Currency Group

DCG, our controlling shareholder, is a global investor, builder, and incubator committed to advancing decentralized ecosystems built on blockchain technology. DCG’s principal stockholders include Bain Capital Ventures, FirstMark Capital, RRE Ventures, Ribbit Capital, Social Capital and SoftBank Vision Fund II-1 L.P.

After the closing of this offering, DCG will own shares of Class A common stock and Class B common stock that in the aggregate will entitle them to % of the combined voting power of our common stock (or % if the underwriters exercise their option to purchase additional shares of Class A common stock in full).

Corporate Information

Grayscale Investments, Inc. (formerly known as GSO Intermediate Holdings I Corporation) was incorporated in the State of Delaware on May 2, 2025 and, prior to the closing of the Private Placement on October 22, 2025, had not conducted any activities other than those incidental to its formation, the Private Placement, the Private Placement Reorganization, the IPO Reorganization and the preparation of this prospectus and the registration statement of which this prospectus forms a part. Our principal executive offices are located at 290 Harbor Drive, 4th Floor, Stamford, Connecticut 06902 and our telephone number is (212) 668‑1427. Our website is www.grayscale.com. Our website and the information contained therein or connected thereto are not incorporated into this prospectus or the registration statement of which it forms a part.

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The Offering

This summary highlights information presented in greater detail elsewhere in this prospectus. This summary is not complete and does not contain all the information you should consider before investing in our Class A common stock. You should carefully read this entire prospectus before investing in our Class A common stock, including the “Risk Factors” section and our consolidated financial statements and notes thereto included elsewhere in this prospectus.


Class A common stock offered by us	shares (or shares if the underwriters exercise their option to purchase additional shares of Class A common stock in full).
Class A common stock to be outstanding immediately after this offering	shares (or shares if the underwriters exercise their option to purchase additional shares of Class A common stock in full).
Class A common stock to be outstanding after conversion of all LLC Units	shares if all outstanding LLC Units held by the Pre-IPO LLC Members were redeemed or exchanged for a corresponding number of newly issued shares of Class A common stock (or shares if the underwriters exercise their option to purchase additional shares of Class A common stock in full).
Class B common stock to be outstanding immediately after this offering	shares (or shares if the underwriters exercise their option to purchase additional shares of Class A common stock in full).
Total Class A common stock and Class B common stock to be outstanding after this offering	shares.
Voting power held by holders of Class A common stock after giving effect to this offering	30%
Voting power held by holders of Class B common stock after giving effect to this offering	70%
Voting rights after giving effect to this offering	Each share of Class A common stock will entitle its holder to one vote, and, except as described below, each Class B common stock will entitle its holder to ten votes until the occurrence of the Sunset Event. Investors in this offering will hold approximately % of the combined voting power of our common stock (or % if the underwriters exercise their option to purchase additional shares of Class A common stock in full). Class A common stock and Class B common stock generally vote together as a single class on all matters submitted to a vote of our stockholders. Class B common stock is subject to a ratable cutback of votes to the extent necessary to ensure that the outstanding shares of Class B common stock, in the aggregate, are entitled to no more than 70% of the total number of votes to which the shares of our Class A common stock and Class B common stock are entitled. Following the Sunset Event, holders of Class B common stock will be entitled to one vote per share. The “Sunset Event” will occur at 5:00 p.m., New York time, on the first day on which the number of shares of Class B common stock beneficially owned by DCG and its affiliates together represents less than 20% of the total number of the then outstanding shares of our common stock.

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	See “Description of Capital Stock.”
Redemption rights of the holders of LLC Units	Under the Amended LLC Agreement, all current and future holders of LLC Units, including the Pre-IPO LLC Members, will have the right, from and after the completion of this offering, to require Grayscale Operating, LLC to redeem all or a portion of their LLC Units for, at our election, newly issued shares of Class A common stock on a one-for-one basis or a cash payment equal to the volume-weighted average market price of one share of our Class A common stock for each LLC Unit redeemed (subject to customary adjustments, including for stock splits, reverse splits, stock dividends and other similar events affecting the Class A common stock) in accordance with the terms of the Amended LLC Agreement. Additionally, in the event of a redemption request by a holder of LLC Units, we may, at our option, effect a direct exchange of cash or Class A common stock for LLC Units in lieu of such a redemption. A corresponding number of shares of Class B common stock will be canceled on a one-for-one basis if we, following a redemption request of a holder of LLC Units, redeem or exchange LLC Units of such holder of LLC Units pursuant to the terms of the Amended LLC Agreement. See “Certain Relationships and Related Person Transactions—Amended LLC Agreement.” Except for transfers to us pursuant to the Amended LLC Agreement or to certain permitted transferees, holders of LLC Units are not permitted to sell, transfer or otherwise dispose of any LLC Units or shares of Class B common stock.
Tokenized Class A common stock	We intend to explore permitting shareholders to hold their Class A common stock in tokenized form on a blockchain to be selected by Grayscale, as the market for tokenized equities develops. Tokenized Class A common stock is not available in this offering. See “Description of Capital Stock—Tokenized Class A Common Stock.”
Use of proceeds	We estimate that the net proceeds to us from this offering will be approximately $ million, or approximately $ million if the underwriters exercise their option to purchase additional shares of Class A common stock in full, assuming an initial public offering price of $ per share (the midpoint of the estimated price range set forth on the cover page of this prospectus), after deducting estimated underwriting discounts and commissions and estimated offering expenses. Each $1.00 increase (decrease) in the public offering price per share would increase (decrease) our net proceeds, after deducting estimated underwriting discounts and commissions, by $ million (assuming no exercise of the underwriters’ option to purchase additional shares of Class A common stock). We intend to use the net proceeds that we receive from this offering to purchase LLC Units (or LLC Units if the underwriters exercise their option to purchase additional shares of Class A common stock in full) from the Pre-IPO LLC Members at a purchase price per LLC Unit equal to the initial

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	public offering price per share of Class A common stock after underwriting discounts and commissions. Grayscale Operating, LLC will not receive any proceeds from the purchase of LLC Units from the Pre-IPO LLC Members by us. We estimate that the offering expenses (other than the underwriting discounts and commissions) will be approximately $ . See “Use of Proceeds.”
Controlled Company	Upon the closing of this offering, entities controlled by DCG will beneficially own more than 50% of the voting power for the election of members of our board of directors and will enter into the Stockholders Agreement. Consequently, we will be a “controlled company” under the rules of the NYSE. As a controlled company, we qualify for, and intend to rely on, exemptions from certain corporate governance requirements of the NYSE. See “Management—Controlled Company Exemption.”
Tax Receivable Agreement	Pursuant to the Tax Receivable Agreement that we have entered into with the Pre-IPO LLC Members, we will pay 85% of the amount of certain cash savings, if any, in U.S. federal, state and local income tax or franchise tax that we actually realize to the Pre-IPO LLC Members as a result of (i) any increase in tax basis in Grayscale Operating, LLC’s assets resulting from (a) acquisitions by Grayscale Investments, Inc. of LLC Units from the Pre-IPO LLC Members in connection with this offering, (b) the acquisition of LLC Units from the Pre-IPO LLC Members using the net proceeds from any future offering, (c) future taxable redemptions or exchanges by the Pre-IPO LLC Members of LLC Units for shares of our Class A common stock or cash or (d) payments under the Tax Receivable Agreement and (ii) tax benefits related to imputed interest resulting from payments made under the Tax Receivable Agreement. Our obligations under the Tax Receivable Agreement also apply with respect to any person that becomes a party to the Tax Receivable Agreement in the future. See “Organizational Structure—Holding Company Structure and the Tax Receivable Agreement.”
Dividend policy	Any determination to pay dividends on our Class A common stock will be at the discretion of our board of directors, subject to applicable laws, and will depend on our financial condition, results of operations, capital requirements, general business conditions, and other factors that our board of directors considers relevant. See “Dividend Policy.” Following this offering and subject to funds being legally available, we intend to cause Grayscale Operating, LLC to make pro rata distributions to the Pre-IPO LLC Members and us in an amount at least sufficient to allow us and the Pre-IPO LLC Members to pay all applicable taxes, to make payments under the Tax Receivable Agreement we have entered into with the Pre-IPO LLC Members and to pay our corporate and other overhead expenses.
Directed share program	At our request, the underwriters have reserved up to shares of our Class A common stock, or % of the shares offered in this offering, for sale at the initial public offering price through a directed share program to certain eligible investors in our Grayscale Bitcoin Trust ETF (“GBTC”) and

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	our Grayscale Ethereum Trust ETF (“ETHE”) and certain individuals identified by our officers and directors. In order for investors in GBTC or ETHE to be potentially eligible for the directed share program, they must have held shares of GBTC or ETHE as of October 28, 2025. In addition, eligible participants must reside in the United States and be at least 18 years of age. We will invite investors who held shares of GBTC or ETHE as of October 28, 2025 to pre-register for the directed share program. Investors must pre-register for the directed share program by November 24, 2025 to be considered for eligibility for receiving an allocation of shares in the directed share program, but completing the pre-registration process does not guarantee an allocation in the directed share program. We cannot provide any assurance that any eligible participant will receive an allocation in the directed share program. Shares purchased through the directed share program will not be subject to the terms of the lock-up agreement or market standoff restrictions. The number of shares of Class A common stock available for sale to the general public will be reduced to the extent that such persons purchase such reserved shares. Any reserved shares not so purchased will be offered by the underwriters to the general public on the same basis as the other shares offered by this prospectus. Other than the underwriting discount described on the front cover of this prospectus, the underwriters will not be entitled to any commission with respect to shares of Class A common stock sold pursuant to the directed share program. We will agree to indemnify the underwriters against certain liabilities and expenses, including liabilities under the Securities Act, in connection with sales of the shares reserved for the directed share program. will administer our directed share program. See “Underwriters—Directed Share Program” for more information.
Risk factors	See the section titled “Risk Factors” and other information included in this prospectus for a discussion of factors you should carefully consider before deciding to invest in our Class A common stock.
Material U.S. Federal Tax Considerations for Non-U.S. Holders of Common Stock	For a discussion of the material U.S. federal income and estate tax consequences that may be relevant to non-U.S. stockholders, see “Material U.S. Federal Tax Considerations for Non-U.S. Holders of Common Stock.”
Proposed stock exchange symbol	We have applied to list our Class A common stock on the NYSE under the symbol “GRAY.”

Unless we indicate otherwise throughout this prospectus, the number of shares of our Class A common stock outstanding after this offering excludes:

•

shares of Class A common stock issuable upon exercise of options outstanding as of , 2025 under the Omnibus Incentive Plan, with a weighted-average exercise price of $ per share of Class A common stock;

•

shares of Class A common stock issuable upon vesting and settlement of restricted stock units granted under the IPO Founder Award and the IPO Executive Awards (each as defined herein) under the Omnibus Incentive Plan. See

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“Executive and Director Compensation—Equity Incentive Compensation—IPO Grants” for information regarding the IPO Founder Award and IPO Executive Awards;

•

shares of Class A common stock reserved for issuance upon the exchange of LLC Units that will be held by the Pre-IPO LLC Members;

•

shares of our Class A common stock issuable if the underwriters exercise their option to purchase additional shares of Class A common stock from us;

•

shares of Class A common stock reserved for issuance under the Omnibus Incentive Plan. See “Executive and Director Compensation—Equity Incentive Compensation—Omnibus Incentive Plan” for more information regarding the Omnibus Incentive Plan; and

•

shares of Class A common stock reserved for issuance under the Employee Stock Purchase Plan, which we refer to as the “ESPP.” See “Executive and Director Compensation—Equity Incentive Compensation—Employee Stock Purchase Plan” for information regarding the ESPP.

Unless we specifically state otherwise, all information in this prospectus:

•

except for our historical consolidated financial statements and notes thereto included elsewhere in this prospectus, gives effect to the Private Placement and the Private Placement Reorganization and assumes the consummation of the IPO Reorganization described under “Organizational Structure—The IPO Reorganization”;

•

gives effect to the conversion of all of the outstanding Convertible Preferred Stock into an aggregate of shares of Class A common stock (assuming an initial public offering price of $ per share, which is the midpoint of the estimated price range set forth on the cover page of this prospectus);

•

assumes no exercise of the underwriters’ option to purchase additional shares of Class A common stock; and

•

assumes an initial public offering price of $ per share of our Class A common stock (the midpoint of the estimated price range set forth on the cover page of this prospectus).

Summary Consolidated Financial and Other Data

The following tables present the summary consolidated historical financial data for Grayscale Operating, LLC and its consolidated subsidiaries and summary unaudited pro forma condensed consolidated financial information for Grayscale Investments, Inc. for the periods and at the dates indicated. The summary consolidated statements of operations data for the nine months ended September 30, 2025 and 2024 and the summary consolidated statement of financial condition data as of September 30, 2025 are derived from the Grayscale Operating, LLC unaudited condensed consolidated financial statements included elsewhere in this prospectus. The summary consolidated statements of operations data for the years ended December 31, 2024 and 2023 and the summary consolidated statement of financial condition data as of December 31, 2024 and 2023 have been derived from the audited consolidated financial statements and notes of Grayscale Operating, LLC and its consolidated subsidiaries included elsewhere in this prospectus. The Pre-IPO Reorganization completed on January 1, 2025 was treated as a reorganization of companies under common control and has been accounted for as a change in reporting entity between entities under common control, as each entity was controlled by DCG. Accordingly, Grayscale Operating, LLC’s consolidated financial statements included in this prospectus as of and for the years ended December 31, 2024 and 2023 have been presented giving retroactive effect to the Pre-IPO Reorganization in accordance with ASC 250-10-45-21.

The summary unaudited pro forma condensed consolidated financial information presented below has been derived from Grayscale Investments, Inc.’s unaudited pro forma condensed consolidated financial statements included elsewhere in this prospectus. Grayscale Investments, Inc. was formed as a Delaware corporation on May 2, 2025 and, prior to the closing of the Private Placement on October 22, 2025, had not conducted any activities other than those incidental to its formation, the Private Placement, the Private Placement Reorganization, the IPO Reorganization and the preparation of this prospectus and the registration statement of which this prospectus forms a part.

The summary unaudited pro forma condensed consolidated statement of operations data for the nine months ended September 30, 2025 and fiscal year ended December 31, 2024 gives effect to the Pro Forma Transactions, as described under the section titled “Unaudited Pro Forma Condensed Consolidated Financial Information” as if all such transactions had occurred on January 1, 2024. The summary unaudited pro forma condensed consolidated statement of financial condition data as of September 30, 2025 gives effect to the Pro Forma Transactions as if they had occurred on September 30, 2025.

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The summary historical financial data and unaudited pro forma condensed consolidated financial information presented below do not purport to be indicative of the results that can be expected for any future period and should be read together with “Capitalization,” “Unaudited Pro Forma Condensed Consolidated Financial Information,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our consolidated financial statements and related notes thereto included elsewhere in this prospectus. The presentation of the summary unaudited pro forma condensed consolidated financial information is prepared in conformity with Article 11 of Regulation S-X. The Pro Forma Transactions include various estimates that are subject to material change and may not be indicative of what our operations or financial position would have been had this offering and related transactions taken place on the dates indicated, or that may be expected to occur in the future. See “Unaudited Pro Forma Condensed Consolidated Financial Information” for a complete description of the adjustments and assumptions underlying the summary unaudited pro forma condensed consolidated financial data.


	Actual Grayscale Operating, LLC												Pro Forma Grayscale Investments, Inc.
	Nine Months Ended September 30,						Year Ended December 31,						Nine Months Ended September 30,	Year Ended December 31,
	2025			2024			2024			2023			2025	2024
	(in thousands)
Total revenues	$	318,668		$	397,866		$	506,157		$	512,707
Total operating expenses		116,286			107,270			140,792			100,164
Operating income		202,382			290,596			365,365			412,543
Other income		2,145			4,044			6,363			20,043
Income before provision for income taxes		204,527			294,640			371,728			432,586
Provision for income taxes		1,260			70,953			89,579			107,633
Net income		203,267			223,687			282,149			324,953

Pro forma net income per share of Class A common stock
Basic
Diluted
Pro forma weighted average shares of Class A common stock outstanding
Basic
Diluted

Other Data:
Net cash provided by operating activities	$	179,296		$	223,379		$	289,193		$	152,361
Net cash used in investing activities		(396	)		(905	)		(1,185	)		(1,789	)
Net cash used in financing activities		(179,129	)		(220,151	)		(299,298	)		(44,806	)
Adjusted Operating Income(1)		209,457			299,736			377,584			427,204
Adjusted Net Income(1)		208,157			227,553			286,594			320,910
Weighted-average management fee		1.39	%		1.67	%		1.61	%		2.13	%
	AUM (in millions)
Average AUM		30,631			31,751			31,459			24,094

(1) We define Adjusted Operating Income as operating income adjusted for stock-based compensation expense, realized and unrealized gains (losses), net, other income, nonrecurring executive transition-related charges associated with changes to key executive team members and listing expenses related to the Pre-IPO Reorganization and initial public offering process of the Company. We define Adjusted Net Income as net income adjusted for stock-based compensation expense, realized and unrealized gains (losses), net, nonrecurring executive transition-related charges associated with changes to key executive team members and listing expenses related to the Pre-IPO Reorganization and initial public offering process of the Company. Adjusted Operating Income and Adjusted Net Income are non-GAAP financial measures. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Non-GAAP Financial Measures” for more information on our non-GAAP financial measures.

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	Actual Grayscale Operating, LLC						Pro Forma Grayscale Investments, Inc.
	September 30,		December 31,				September 30,
	2025		2024		2023		2025
	(in thousands)
Balance Sheet Data:
Cash and cash equivalents	$	99,959	$	100,188	$	111,478
Working capital		96,398		70,746		84,861
Total assets		141,186		123,383		122,382
Total liabilities		40,011		46,349		30,762
Member’s / stockholders’ equity		101,175		77,034		91,620

The following tables provide a reconciliation of operating income to Adjusted Operating Income for the periods presented:


	Nine Months Ended September 30,						Year Ended December 31,
	2025			2024			2024			2023
	(in thousands)
Operating income, as reported	$	202,382		$	290,596		$	365,365		$	412,543
Adjusted for the following:
Stock-based compensation		1,155			2,472			2,563			12,725
Non-recurring executive transition-related charges		3,675			3,468			4,392			—
Non-recurring listing expenses		—			215			1,391			—
Other income		2,145			4,044			6,363			20,043
Realized and unrealized losses (gains), net		100			(1,059	)		(2,490	)		(18,107	)
Adjusted Operating Income	$	209,457		$	299,736		$	377,584		$	427,204
Adjusted Operating Margin		65.7	%		75.3	%		74.6	%		83.3	%

The following tables provide a reconciliation of net income to Adjusted Net Income for the periods presented:


	Nine Months Ended September 30,						Year Ended December 31,
	2025			2024			2024			2023
	(in thousands)
Net income, as reported	$	203,267		$	223,687		$	282,149		$	324,953
Adjusted for the following:
Stock-based compensation, net of income taxes		1,147			1,876			1,945			9,559
Non-recurring executive transition-related charges, net of income taxes		3,639			2,632			3,334			—
Non-recurring listing expenses, net of income taxes		—			163			1,056			—
Realized and unrealized losses (gains), net of income taxes		104			(806	)		(1,890	)		(13,602	)
Adjusted Net Income	$	208,157		$	227,553		$	286,594		$	320,910
Adjusted Net Income Margin		65.3	%		57.2	%		56.6	%		62.6	%

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Risk Factors

An investment in our Class A common stock involves a significant degree of risk. You should carefully consider the risks described below, which do not necessarily appear in order of importance, and the other information contained in this prospectus, before making an investment in our Class A common stock. If any of the following risks were to occur, then our business, financial condition, results of operations and cash flow could be materially adversely affected. In that case, the market price of our Class A common stock could decline, and you could lose all or part of your investment.

The following risks are not the only ones facing our company. Additional risks not currently known to us, or that we currently deem immaterial, may also adversely affect us. You are strongly encouraged to consult your own professional advisors before deciding to invest in our Class A common stock.

Declines in the market prices of digital assets have in the past caused, and could in the future cause, our revenues to decrease.

Substantially all of our revenues are derived from fees as a percentage of the value of our AUM. Declines in the market prices of digital assets have in the past reduced, and could in the future reduce, the dollar value of fees we earn from our investment products, as fees on our investment products are generally settled in the underlying digital assets. Further, in response to, or otherwise in connection with, declines in the market prices of digital assets, investors in digital assets may sell their shares of our investment products in favor of investments that they perceive to offer greater opportunity or lower risk, thus triggering outflows from our investment products for which we operate a redemption program and further reducing our revenues derived from fees. As a result, our revenues could be adversely affected by declines in the market prices of digital assets. Finally, our Principal Investments may further expose us to the impact of any declines in the market prices of digital assets.

The market prices of digital assets have historically been subject to significant volatility, including steep declines. For example, after reaching then-record highs in November 2021, total digital asset market capitalization declined by approximately 62% in the 21 months ended September 30, 2023, before rebounding by approximately 263% in the 24 months ended September 30, 2025. The collapse of several companies in the digital asset industry, such as BlockFi Inc. (“BlockFi”), Celsius Network LLC (“Celsius”), Voyager Digital Ltd. (“Voyager”), FTX Trading Ltd. (“FTX”) and Three Arrows Capital, as well as Genesis Global Holdco, LLC (“Genesis Holdco”), along with its subsidiaries Genesis Global Capital, LLC (“Genesis Capital”) and Genesis Asia Pacific Pte. Ltd. (“Genesis Asia Pacific,” and together with Genesis Holdco and Genesis Capital, the “Genesis Entities”), impacted the market prices of digital assets in 2022 and the beginning of 2023. Additionally, on October 10, 2025, digital asset prices experienced a sharp, market-wide decline reportedly driven by a cascade of forced liquidations of approximately $20 billion in leveraged positions following a sudden drop in Bitcoin and Ether prices. The resulting sell-off caused abrupt declines across most digital assets and heightened volatility throughout the ecosystem. Any similar failure of companies, such as those of 2022 and 2023, or market-wide liquidations across large leveraged positions, such as those more recently in the digital asset industry in the future could further impact market prices.

The market price of any digital asset continues to be subject to significant uncertainty and volatility and may significantly decline in the future without recovery. For more information on the factors contributing to such uncertainty and volatility, see “—Risk Factors Related to Digital Assets—The prices of digital assets have experienced extreme volatility in recent periods and may continue to do so and could adversely affect our results of operations.” Furthermore, negative perception and a lack of stability and standardized regulation in the digital asset industry may reduce confidence in the digital asset industry and may result in greater volatility in the market prices of digital assets, including a depreciation in value. While we offer some products that are actively managed, most of our current investment products are not actively managed, and we will not take any actions to take advantage, or mitigate the impact, of significant volatility in the market prices of digital assets. Declines in the market price of digital assets have in the past caused, and could in the future cause, our revenues to decrease.

Unlike traditional investment platforms that hold assets across a variety of asset classes, our investment products are invested exclusively in digital assets and highly concentrated in Bitcoin and Ether in particular.

As of September 30, 2025, the Grayscale Bitcoin Trust ETF (“GBTC”) and the Grayscale Ethereum Trust ETF (“ETHE”) accounted for approximately 70% of our AUM collectively. Fees from GBTC and ETHE collectively comprised approximately 88% and 93% of our total revenues for the nine months ended September 30, 2025 and the year ended December 31, 2024, respectively. As a result, our results of operations are particularly exposed to the performance of, and investor sentiment toward, GBTC and ETHE specifically, and Bitcoin and Ether generally. If the prices of Bitcoin and Ether were to decline, then our revenues associated with these investment products would be adversely affected. Further, our Principal Investments may be comprised of substantial amounts of Bitcoin and Ether, causing us to be further exposed to the market prices of these two digital assets. The trading prices of many digital assets,

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including Bitcoin and Ether, have experienced extreme volatility throughout their existence, including in recent periods, and may continue to do so. Volatility may increase or decrease due to various factors including, but not limited to, token-specific events such as the reduction of mining rewards that occur on a programmatic basis, liquidity in the digital asset markets, organization-specific events for entities that hold, or transact in, a significant value of digital assets such as bankruptcies or litigation. For instance, following significant increases throughout the majority of 2020, digital asset prices, including Bitcoin and Ether, experienced significant volatility throughout 2021 and 2022 in response to, among other factors, the collapse of several digital asset companies, including FTX. In particular, during this period the price of Bitcoin peaked at $67,371.70 in November 2021 before it declined to $16,556.29 at the end of 2022, and the price of Ether peaked at $4,776.95 in November 2021 before it declined to $1,201.33 at the end of 2022. From October 1, 2020 through September 30, 2025, the price of Bitcoin ranged from $10,515.13 to $122,824.79 and the price of Ether ranged from $340.17 to $4,833.89. In addition, during the twelve months ended September 30, 2025, the price of Bitcoin ranged from $59,670.00 to $122,824.79 and the price of Ether ranged from $1,465.40 to $4,833.89.

Furthermore, during the year ended December 31, 2024, GBTC and ETHE each suffered aggregate net outflows of over $21.5 billion and $3.6 billion, respectively. Prior to uplisting to NYSE Arca as ETPs, there was no redemption mechanism for GBTC and ETHE, and, as a result, shares of GBTC and ETHE traded at a discount to the NAV per share on OTCQX. Upon uplisting to NYSE Arca, GBTC and ETHE were permitted to redeem their shares, and GBTC’s and ETHE’s authorized participants were able to earn a profit by purchasing GBTC and ETHE shares at a discount to NAV and redeeming them for Bitcoin and Ether, respectively, resulting in outflows. Following the uplisting to NYSE Arca, the shares of GBTC and ETHE trade closely to the NAV per share, and, as a result, the Company does not expect historical outflows during this period to be indicative of future flows. Additionally, in connection with GBTC and ETHE uplisting to NYSE Arca as ETPs, several other lower cost spot Bitcoin ETPs and spot Ether ETPs also launched, and some investors sold or redeemed their shares of GBTC and ETHE for either lower-fee alternatives or to reduce their exposure to digital assets at that time. During the nine months ended September 30, 2025, GBTC and ETHE experienced net outflows of approximately $2.6 billion and $911 million, respectively. If shareholders of these investment products continue to sell or redeem their shares, whether due to increased fee or other competition or for any other reason, this could trigger further outflows from GBTC and/or ETHE, and our AUM and revenue from these investment products would continue to decline and our results of operations may be adversely affected.

We are exposed to a concentration of assets in a particular asset class, which could increase volatility and market risk.

Unlike traditional investment platforms that hold assets across a variety of asset classes, our investment products are invested exclusively in digital assets. We therefore have concentrated exposure to the digital asset industry, which may be exacerbated by our Principal Investments, and the success of our business is closely tied to conditions in the digital asset markets, which continue to be extremely volatile. For more information on the factors contributing to such volatility, including additional factors that could impact the value of our Principal Investments, see “—Risk Factors Related to Digital Assets—The prices of digital assets have experienced extreme volatility in recent periods and may continue to do so and could adversely affect our results of operations.”

Increased competition in the digital asset investment industry, and the investment industry more generally, may cause our AUM and revenues to stagnate or decrease.

The digital asset investment industry, and the investment industry more generally, is highly competitive. We expect that new services and technologies may continue to emerge and evolve, which may be superior to the digital asset products that we currently provide. We could lose market share to our competitors or new market participants, which would adversely affect our business, operating results, financial condition, and future prospects. We compete with traditional, alternative and digital asset-focused investment platforms that provide investors with exposure to digital assets across various dimensions, including with respect to fee levels, trading liquidity and market breadth of investment product offerings, brand recognition, business reputation and the development of new investment products to meet the changing needs of investors.

We face market pressure on fees in all of our investment products. For example, concurrent with the SEC’s approval of the listing and trading of GBTC on NYSE Arca as an ETP, the SEC also approved the listing and trading of numerous other competing ETPs by both digital asset-focused and traditional investment managers holding Bitcoin on national securities exchanges. These competing investment products charge lower fees than GBTC (and in some cases, initially waived fees altogether), and they are often backed by larger competitors with more diversified businesses that can manage these Bitcoin ETPs at lower costs, either as a result of greater operational efficiencies or economies of scale or as loss leaders due to other revenue sources available to them. Since GBTC and ETHE’s uplistings, these products had experienced approximately $24.1 billion and $4.6 billion of net outflows as of September 30, 2025, respectively. Upon uplisting, we lowered GBTC’s management fee from 2.0% to 1.5% of its net asset value. We maintained ETHE’s management fee at 2.5% of its net asset value. In addition, in connection with the launch of GBTC and ETHE as ETPs, Grayscale spun off a portion of their assets into BTC Mini and ETH Mini, which, as of the date of this prospectus, are the lowest-cost Bitcoin and Ether ETPs, respectively, in the U.S. market, each with a fee of 0.15 % of net asset value. We expect that continued market pressures on fees, and specifically the availability of several lower fee alternatives offering investors the same exposure to Bitcoin and Ether (including, but not limited to, the Mini Trusts) and any other digital assets for which we offer investment products, could lead to additional outflows for GBTC and ETHE and our other digital asset products.

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Further, we face competition with respect to the creation of new spot digital asset ETPs. Although in the past the SEC had only approved applications under Rule 19b-4 of the Exchange Act to list spot digital asset ETPs that hold Bitcoin and Ether, as well as GDLC, on July 30, 2025, Cboe BZX Exchange, Nasdaq, and NYSE Arca each filed a proposed rule change with the SEC to amend their respective listing rules to include generic listing standards for shares of certain commodity-based ETPs that satisfy specific requirements. The SEC approved the proposed rule changes on September 17, 2025. As adopted, a commodity ETP that meets an exchange’s generic listing standards are eligible for listing on such exchange without the need to submit a separate Rule 19b-4 application to the SEC, which may streamline the creation of new spot digital asset ETPs both for us and for our competitors. On September 17, 2025, the SEC approved a rule change to enable GDLC to trade on NYSE Arca pursuant to Rule 8.201-E’s generic listing standards. GDLC holds Bitcoin, Ether, XRP, Solana and Cardano. On September 23, 2025, the SEC approved a rule change to enable ETHE and ETH Mini to trade on NYSE Arca pursuant to Rule 8.201-E’s generic listing standards. Additionally, on October 29, 2025, GSOL was listed and began trading on NYSE Arca pursuant to Rule 8.201-E’s generic listing standards. If further spot digital asset ETPs that hold assets other than Bitcoin, Ether, Solana, XRP or Cardano are launched, to the extent such competing digital asset ETPs come to represent a significant proportion of the demand for digital assets generally, demand for, and the price of, Bitcoin, Ether, Solana, XRP or Cardano could be reduced, thus causing the AUM and revenues of our existing ETPs to stagnate or decrease. Such reduced demand could in turn cause our AUM and revenues to further stagnate or decrease if we do not offer, or are slower than our competitors to offer, ETPs for these competing digital assets. Additionally, new digital assets may be created and, even if products investing in such digital assets are not listed on national securities exchanges as ETPs, they may become popular and compete with Bitcoin or Ether in the digital asset market. Whether we are successful in maintaining our competitive position may be impacted by our timing in entering the market relative to competing ETPs or other digital asset products. Our ability to compete with new digital asset products may be inhibited by regulatory requirements and general uncertainty in the law or other factors. If we cannot keep pace with rapid industry changes to provide new and innovative digital asset products, the use of our products, and consequently our net revenue, could stagnate or decline, which could adversely affect our business, operating results and financial condition. There can be no assurance that we will be able to develop new ETPs or other new digital asset products on a timeline sufficient to obtain an early market entry advantage.

Additionally, our competitors may offer features or functionality that we do not. For example, in 2025, the SEC approved digital asset ETPs to offer in-kind creation and redemption mechanisms, which we do not currently offer in our ETPs. The absence of in-kind creation and redemptions could place our ETPs at a competitive disadvantage relative to peer ETPs that have adopted such features. In-kind creations allow authorized participants and institutional investors to contribute underlying tokens directly to form new shares of the ETP, which is often more tax-efficient. ETPs with in-kind creation mechanisms may therefore be more attractive to certain investors seeking to convert their underlying tokens into ETP shares without triggering taxable events. As a result, competing products offering in-kind functionality could experience higher inflows, while our ETPs may miss out on new investments and asset growth opportunities. If we were to offer in-kind creation and redemption in the future--particularly through processes that make redemptions easier to execute and more tax-efficient--investors may be more likely to redeem their shares, leading to greater outflows, which would reduce our AUM and adversely affect our results of operations.

Moreover, our competition may offer a broader range of investment products that better meet the changing needs of investors, command more visible brand recognition or uphold a more positive business reputation. Some of our competitors, such as traditional investment platforms, operate in a more favorable regulatory environment, operate under more established and predictable regulatory frameworks or are subject to less frequent regulatory scrutiny than digital asset-focused firms such as ours or have proprietary products, diversified sources of revenue and distribution channels that may provide them and their investment products with certain competitive advantages, including in pricing their investment products to reflect greater operational efficiencies or economies of scale or as loss leaders. Other competitors may offer investment products that command greater trading liquidity or market breadth. In addition, consolidation within our industry, coupled with emerging technologies and fewer barriers to entry, may also put us at a competitive disadvantage.

We anticipate implementing our Principal Investments, and when implemented, this strategy would expose us to various risks, including the following:

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The price of digital assets we may hold as part of our Principal Investments, either directly or through our investment products, are highly volatile. For example, Bitcoin has traded below $80,000 per Bitcoin and above $120,000 per Bitcoin in the 12 months preceding the date of this prospectus. Similarly, Ethereum has traded below $1,500 per Ether and above $4,500 per Ether in the same period. See “—The prices of digital assets have experienced extreme volatility in recent periods and may continue to do so and could adversely affect our results of operations.”

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Our Principal Investments, which may include holdings of our investment products, would significantly impact our financial results and the market price of our listed securities. Because we intend to purchase digital assets and otherwise increase our Principal Investments organically through tokens that we accrue from our asset management business, the proportion of total assets represented by our digital asset holdings would increase in the future. As a result, volatility in our earnings may be significantly more than what we have experienced in prior periods, during which we converted the tokens we accrued from our asset management business into cash on a programmatic basis.

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A significant portion of our total assets would be concentrated in Principal Investments. This concentration of assets would limit our ability to mitigate risks that could otherwise be achieved by holding a more diversified portfolio of treasury assets.

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To the extent we seek to raise equity or debt financings to fund purchases of digital assets or increase our exposure to digital assets, we may not be able to obtain such financings on favorable terms or at all.

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Our Principal Investments initiative has not been tested. Although we believe our Principal Investments have the potential to enhance our balance sheet, support our investment products, and serve as a hedge against inflation in the long term, the short-term price of certain digital assets has declined in recent periods during which the inflation rate increased. If digital asset prices were to decrease or our Principal Investments otherwise proves unsuccessful, our financial condition, results of operations, and the market price of our listed securities would be materially adversely impacted.

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We are subject to counterparty risks, including risks relating to our Custodians, with respect to our Principal Investments. See “—We rely on Coinbase Custody to provide us and our investment products with critical custody services for a substantial amount of the digital assets for which we offer investment products, including the digital assets and investment products that would be part of our Principal Investments. The failure of Coinbase Custody or other custodians to adequately safeguard these digital assets, or any disruptions to its services, could materially adversely affect our business and harm investors in our investment products.”

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The broader digital assets industry is subject to counterparty risks, which in some instances is concentrated, and which could adversely impact the adoption rate, price, and use of the digital assets, including those we may hold in our Principal Investments. A series of high-profile bankruptcies, closures, liquidations, regulatory enforcement actions and other events in 2022 and 2023 relating to companies operating in the digital asset industry have highlighted the counterparty risks applicable to owning and transacting in digital assets and would likely, in the short term, negatively impact the adoption rate and use of any digital asset we hold. Future bankruptcies, closures, liquidations, regulatory enforcement actions or other events involving participants in the digital assets industry may further negatively impact the adoption rate, price, and use of any digital asset we hold, limit the availability to us of financing collateralized by the digital asset we hold, or create or expose additional counterparty risks.

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Changes in the accounting treatment of digital asset holdings could have a significant impact on our financial reporting, including increasing the volatility of our results. We have adopted ASU 2023-08 as of January 1, 2024, which requires us to measure any digital asset holdings, including those in any Principal Investments, at fair value in our statement of financial position, and to recognize gains and losses from changes in the fair value of any digital asset we hold in net income each reporting period beginning January 1, 2024. ASU 2023-08 also requires us to provide certain interim and annual disclosures with respect to our digital asset holdings. Due in particular to the volatility in the price of the digital assets we may hold in our Principal Investments, the adoption of ASU 2023-08 will likely have a material impact on our reported financial results and to affect the carrying value of any digital asset we hold on our balance sheet in future periods.

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The broader digital assets industry, including the technology associated with digital assets, the rate of adoption and development of, and use cases for, digital assets, market perception of digital assets, and the legal, regulatory, and accounting treatment of digital assets are constantly developing and changing, and there may be additional risks in the future that are not possible to predict.

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Because our Principal Investments initiative, when implemented, will result in us holding digital assets directly or through our investment products, all of the risks described in “Risk Factors Related to Digital Assets” apply to our Principal Investments.

We may not successfully implement our Principal Investments or realize its intended benefits.

Our Principal Investments initiative has not been tested, and there can be no assurance that we will successfully implement this strategy or realize its intended benefits. We expect our Principal Investments to enhance our balance sheet and support our investment products; however, the success of this strategy depends on our ability to effectively deploy and manage digital assets and on the future performance of those assets. The price of the digital assets we may hold as part of our Principal Investments, either directly or through our investment products, are highly volatile. If the value of these digital assets declines or their performance fails to meet our expectations, our Principal Investments may not increase in value, may not provide the intended hedge against inflation, and may not enhance our financial condition or the market price of our listed securities as anticipated.

In addition, our ability to execute this strategy depends on the adequacy of our operational infrastructure, risk management and compliance controls, and access to financing and custody solutions. If we are unable to effectively implement, manage, or grow our Principal Investments, or if the strategy fails to achieve its intended benefits, our business, financial condition, results of operations, and the market price of our listed securities could be materially adversely affected.

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Competition from other methods of investing in digital assets could cause our AUM and revenues to stagnate or decrease.

Investors may invest in digital assets through means other than our investment products, including through direct investments in digital assets and other financial vehicles, such as treasury companies and securities and derivatives products linked to digital assets. Market and financial conditions, among other reasons outside of our control, may cause investors to find it more attractive to gain exposure to digital assets through methods other than our investment products. The SEC and Commodities Futures Trading Commission (“CFTC”) have also issued a joint staff statement providing the respective staffs’ view that current law does not prohibit SEC- or CFTC-registered exchanges from facilitating trading of certain spot digital asset products, which may expose us to additional types of competition.

In addition, to the extent digital asset financial vehicles other than our investment products tracking the market prices of the same digital assets we offer exposure to come to represent a significant proportion of the demand for digital assets, large sales or redemptions of the securities or units of these digital asset financial vehicles, or private funds holding digital assets, could negatively affect our AUM and reduce our revenues.

We may be unable to develop new investment products, and the development of new investment products may expose us to additional costs or operational risks.

Our financial performance depends, in part, on our ability to develop, market and manage new investment products. The development and introduction of new investment products require continued innovative efforts on our part and may require significant time and resources, as well as ongoing support and investment. Any efforts we make to develop and introduce new investment products may ultimately prove unsuccessful. Substantial risks and uncertainties are associated with the introduction of new investment products, including, but not limited to, the implementation of new and appropriate operational controls and procedures, shifting investor and market preferences, identification of appropriate assets to develop new investment products for the introduction of competing investment products, constraints on our ability to manage growth, our investment products’ ability to meet their investment objectives and compliance with changing regulatory and disclosure requirements.

These risks and uncertainties may be heightened due to the nature of the digital asset industry in which we operate. The digital asset industry, and the digital asset economy generally, has been characterized by rapid, significant and disruptive products and technologies. These include decentralized applications, decentralized finance (“DeFi”), yield farming, staking, token wrapping, governance tokens, transaction fee mining and validating programs, trading competitions, airdrops and giveaways, staking reward programs and novel digital asset fundraising and distribution schemes. We expect new products and technologies to continue to emerge and evolve, which may be superior to, or render obsolete, the investment products that we currently provide. We may also attempt to innovate our investment products in a manner that enables investors to gain exposure to such new products or technologies, thereby exposing us to risks relating to the regulatory uncertainty surrounding these products and technologies. We cannot predict the effects of new products or technologies on our business or the way in which the regulatory environment will respond to any such new products or technologies.

A failure to continue to innovate and introduce successful new investment products, or to effectively manage the risks and uncertainties associated with such investment products, may negatively impact our market share and reputation, and cause our AUM and revenues to decline.

Our digital asset-focused investment products that are not ETPs may fail to achieve their investment objective for the foreseeable future, which could limit investor interest in these investment products.

Generally, the investment objective of our digital asset-focused investment products is for the value of their shares (based on digital asset per share) to reflect the value of the underlying digital assets held by the investment product, determined by reference to an index price, less that investment product’s expenses and other liabilities. Due in large part to the lack of redemption programs for these products and our inability to operate ongoing redemption programs in a manner that complies with applicable securities laws, our digital asset-focused investment products that are not ETPs have historically failed to achieve their investment objective, with shares trading at either premiums or discounts to the value of the underlying digital assets, which at times have been substantial. In order to address this we have established and operate redemption programs for our investment products that are listed on NYSE Arca in reliance on Regulation M exemptive relief in connection with the approvals of such products for listing on NYSE Arca, and while we intend to seek approval to list certain of our other investment products on national securities exchanges, there can be no guarantee that we will obtain such approval or that we will be able to obtain the relief necessary to establish redemption programs in connection with our other investment products. As a result, our other investment products may not achieve their investment objective for the foreseeable future, and this failure could limit interest by investors in our other investment products, thereby limiting our AUM and our revenues derived from fees on such investment products.

Despite the approval of the applications under Rule 19b-4 of the Exchange Act to list GBTC, BTC Mini, ETHE, ETH Mini and GDLC as ETPs, there is no guarantee that similar SEC approval will be obtained for our other investment products, even given the circumstances of the evolving regulatory environment. Similarly, although subsequent to such approval, on September 23, 2025, the

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SEC approved a rule change to enable ETHE and ETH to trade on the exchange pursuant to Rule 8.201-E’s generic listing standards, which has enabled us to stake the Ether held by such products. While we have successfully listed GSOL under such generic listing standards and we believe that certain of our other products may be eligible for listing under the generic listing rules, there is no guarantee that we will or that we will be able to successfully list our other products through the generic listing standards. We currently have pending applications to list Grayscale Dogecoin Trust, Grayscale Avalanche Trust, Grayscale Litecoin Trust, Grayscale XRP Trust, Grayscale Chainlink Trust, Grayscale Bitcoin Cash Trust and Grayscale Stellar Lumens Trust as ETPs, and have filed applications for new Grayscale Cardano Trust, Grayscale Polkadot Trust and Grayscale Hedera Trust ETPs. There can be no guarantee that any such applications will be approved by the SEC. In particular, as of the date of this prospectus, Bitcoin and Ether are the only digital assets with a significant market capitalization that representatives of the SEC have by name indicated that either they or the SEC do not currently view as a security. The SEC may be unlikely to approve a request to list the shares of a spot ETP that holds a digital asset that the SEC believes is a security. Further, the existence of a futures market regulated by the CFTC for digital assets was central to the prior SEC administration’s approval of any request to list shares of a spot ETP holding such digital asset. As of September 30, 2025, there were CFTC-regulated futures markets for several digital assets, including, among others, Bitcoin, Ether, XRP, Dogecoin, Shiba Inu, Cardano and Solana. However, even if a CFTC-regulated futures market for an asset were to exist or a new framework were to be developed, there can be no guarantee that we will be able to establish a redemption program with respect to any of our other digital asset-focused investment products.

Moreover, our failure to obtain SEC approval to list the shares of some of our investment products on a national securities exchange, and our ability or inability to establish and operate a redemption program, may expose us to litigation. For example, on March 6, 2023, Alameda Research, Ltd. (“Alameda”) filed a suit against us and certain of our affiliates in the Court of Chancery of the State of Delaware, alleging various breach of contract and fiduciary duty claims, in part due to our then-failure to operate a redemption program for shares of GBTC and ETHE. Following GBTC’s uplisting as an ETP and implementation of a redemption program, Alameda voluntarily dismissed this suit on January 19, 2024. In the future, we may face additional litigation related to various factors, including a failure to obtain SEC approval or an inability to establish redemption programs for our investment products.

In addition to the lack of redemption programs, there are a number of other factors that may prevent the price of the shares of our investment products from reflecting the value of their underlying digital assets, less expenses and other liabilities. Such factors include, but are not limited to:

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The holding period under Rule 144 (“Rule 144”) under the Securities Act of 1933, as amended (the “Securities Act”), for shares of our investment products purchased in private placements;

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Any technology - or market-based changes or developments with respect to any of our investment products, including any forks, airdrops or similar events;

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The price volatility of the underlying digital assets;

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Volumes on, or closures of, digital asset trading platforms where the underlying digital assets trade due to fraud, failure, security breaches or otherwise;

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The nonconcurrent trading hours between the over-the-counter market and the global digital asset trading platforms for trading the underlying digital assets; and

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Other factors that we may not be able to predict and/or prevent.

Our investment products may fail to meet their investment objectives for the foreseeable future due to any of these factors, which could limit interest by investors in our investment products and adversely affect our results of operations.

If we are unable to successfully distribute our investment products, then our AUM and revenues could be adversely affected.

To sell our investment products, we primarily rely on our internal sales force and may rely on various third-party distribution channels, including RIAs, wirehouses and institutions. As discussed above, the digital asset industry is volatile and relatively new. As a result, investors often require additional investor education and outreach before deciding to invest in our investment products when compared to traditional asset classes. If we are unable to successfully engage with investors and distribute our investment products, including by educating potential investors through our distribution channels, then our AUM and revenues could stagnate or be adversely affected.

Distribution arrangements may be subject to periodic renegotiation that may result in increased distribution costs to us or reductions in the amount of our investment products being marketed or distributed. Also, new fiduciary regulations applicable to our distribution channels could lead to significant shifts in the business models of the intermediaries through which we distribute our investment products and more limited investment product offerings by such intermediaries, potentially resulting in reduced distribution or marketing of certain of our investment products.

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In addition, improper activities, as well as inadequate AML diligence conducted by intermediaries through which we distribute our investment products, could create reputational and regulatory harm to us.

Our brand and reputation are critical to our business, as our business depends on earning and maintaining the trust and confidence of investors in digital assets, participants in the digital asset industry and regulators. Any harm to our brand or reputation could hamper our ability to maintain and grow our AUM and revenues.

Our brand and reputation may be harmed by, among other factors: unfavorable publicity regarding the characteristics of, or changes to, our investment products (including with respect to our ability or inability to offer redemption programs for certain of our investment products), or the digital asset industry generally; the failure to continue to innovate and introduce successful new investment products or to identify timely tokens to include in any Principal Investments; the failure to adhere to contractual requirements or guidelines; the intentional or unintentional misrepresentation of our investment products in advertising materials; the use of underlying digital assets or digital asset networks for illicit or objectionable ends; litigation or regulatory or enforcement actions or investigations in relation to the digital asset industry and its participants generally or of us or our employees, agents, affiliates of key suppliers or distribution partners; operational failures; any failures to comply with legal, tax and / or regulatory requirements; any perceived or actual weakness in our security, financial strength or liquidity; privacy incidents and data security compromises or breaches, including the loss or theft of private keys; the failure to manage actual or potential conflicts of interest; ineffective management or monitoring of key third-party relationships; employee, agent or affiliate misconduct, alleged misconduct and errors; or the actions of other companies in the digital asset industry generally. The Company, our officers, directors, employees, agents and affiliates may also be the target of social media campaigns criticizing actual or perceived actions or inactions that are disfavored by investors in digital assets, our employees or society at large, which could materially impact potential investors’ decisions to invest in our investment products. Additionally, social media campaigns, negative perceptions of or publicity concerning DCG, its business, its officers or directors, its affiliates, or other entities with which we or DCG have a relationship or association, including as a result of litigation against or investigations of DCG or its affiliates, including DCG’s CEO, Barry Silbert, who is also our founder and chairman of our board of directors, could negatively affect our brand and reputation and the market price of our Class A common stock may be adversely affected and more volatile, which could adversely affect our business, financial condition and results of operations. Any brand or reputational harm as a result of the foregoing may also negatively impact the market share of our investment products and cause our AUM and revenues to decline.

More broadly, because the digital asset industry is relatively nascent, public opinion will continue to evolve and is subject to a loss of confidence. For example, certain events, such as FTX’s collapse and the revelation that it had been misusing customer assets, resulted in a loss of confidence in participants of the digital asset industry generally and a cycle of negative publicity surrounding the digital asset market more broadly. In addition, there has been focus on the environmental, social and governance considerations regarding the use of electricity and other resources for digital asset mining operations, and such increased focus could negatively impact companies in the digital asset industry that are not directly involved in mining operations, including us. Unfavorable publicity in relation to the digital asset industry, including the viability of any particular digital asset or digital asset trading platforms or the societal impact of digital assets and the infrastructure that supports them, could have a cascading impact on digital assets as an investable asset class, or even the digital asset industry generally, and adversely affect our business, financial condition and results of operations.

Lack of liquidity, including wide bid/ask spreads, and market disruptions that halt or disrupt trading or create extreme volatility could undermine investor confidence in our investment products and limit investor acceptance of our investment products.

Shares of GBTC, BTC Mini, ETHE, ETH Mini, GDLC and GSOL, as well as our other ETFs, trade on NYSE Arca, and certain of our other digital asset-focused investment products trade in the over-the-counter market, but there can be no assurance that the trading markets for our investment products will be maintained or continue to develop. In deciding whether or not to invest in our products, investors may consider the liquidity risks associated with trading our investment products, including the potential lack of an active market for shares of our investment products or wide bid/ask spreads (the difference between the prices at which shares of our investment products can be bought and sold), which could impact our AUM and revenue.

These risks can be heightened during periods when there is low demand for our investment products, market conditions are volatile or trading is disrupted. In addition, NYSE Arca or the over-the-counter market can halt the trading of GBTC, BTC Mini, ETHE, ETH Mini, GDLC and GSOL, as well as our ETFs and other investment products, for a variety of reasons, some of which may be outside of our control. Lack of liquidity or disruptions in trading could undermine investor confidence in, and hinder our ability to attract investors to, our investment products, which could impact our AUM and revenue.

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Operational risks may materially adversely affect our performance and results of operations, and our risk management strategies may not be effective in mitigating such risks.

Any issue or adverse circumstance surrounding our operational risks may have a material and adverse effect on our performance and results of operations, and we may not be effective in mitigating such risks. We are exposed to material operational risks arising from a number of factors, including, but not limited to, the risk of inadequate or failed internal processes, employee supervision or monitoring mechanisms, service-provider processes (including those of our Custodians), systems and process and system failures or other systems or controls.

We seek to mitigate risk and have established policies for the types of operational risks we face. However, there are inherent limitations to our current and future risk management strategies, including risks that we have not appropriately anticipated, fully or effectively mitigated or identified. Our risk management policies may not adequately prevent or mitigate losses if our practices are not effective in preventing failures. In addition, we may elect to adjust our risk management policies to allow for an increase in risk tolerance, which could expose us to the risk of greater losses. Accurate and timely enterprise-wide risk information is necessary to enhance management’s decision-making in times of crisis. Operational errors or process failures may subject us to financial losses, or expose us to financial liability which may be significant. If our risk management framework proves ineffective or our enterprise risk management information is incomplete or inaccurate, then we could suffer unexpected losses or exposure to liability, which could materially adversely affect our business, financial condition and results of operations.

Due to the fact that we operate in the digital asset industry, we are also subject to unique operational risks. For example, digital asset transfers recorded on a blockchain ledger are typically not reversible without the consent and active participation of the recipient of the transaction. Once a transaction has been verified and recorded in a block that has been added to the blockchain, an incorrect transfer or theft of digital assets generally will not be reversible, and we may not be capable of seeking compensation or any recourse for any such transfer or theft. Although we have processes and procedures in place to limit any such incorrect or fraudulent transfers, it is possible that, through computer or human error or theft or criminal action, our digital assets or those of our investment products could be transferred from our or their accounts, whether held by us directly or with our custodial partners, in incorrect amounts or to unauthorized third parties or uncontrolled accounts. Operational errors, process failures or significant operational delays could materially negatively impact our ability to conduct our business, which could adversely affect our results of operations due to potentially higher expenses and lower revenues, create liability for us or negatively impact our reputation. Recurring operational issues, including those of our custodial partners, may raise concerns among regulators regarding our policy, processes, governance and control environment. In addition, these operational errors, process failures or significant operational delays may present the risk of dissatisfaction by investors in digital assets.

We periodically assess our risk profile and risk management processes to identify opportunities for improvement and to consider whether we need to address new technologies and innovations in our risk management processes and policies. While we have not identified any material gaps, we cannot guarantee that our risk management processes will continue to be sufficient or effective in preventing or mitigating losses.

In the event that our employees, agents or affiliates engage in misconduct, suffer process failures or commit errors, our business, results of operations and reputation may be materially adversely affected.

Misconduct, process failure or error by our employees, agents or affiliates could subject us to legal liability, financial losses and regulatory sanctions and materially adversely affect our business, results of operations and reputation.

Employee, agent or affiliate errors, including errors in the transfer of digital assets and / or process failures, could expose us to the risk of material losses even if the errors and / or process failures are detected. Although we have implemented processes and procedures and provide trainings to our employees and agents to reduce the likelihood of error, these efforts may not be successful. Despite our efforts to train and inform our employees and agents, there may still be confusion among employees, agents and affiliates, particularly in a fast-growing company like ours, with respect to process, procedure, and compliance obligations, including confidentiality, data access and conflicts of interest. Misconduct and process failure could include an employee and / or agent, or group of employees and/or agents engaging in improper or unauthorized activities, misappropriating investor funds or information, failing to supervise other employees or service providers, improperly using confidential information, or failing to discharge their obligations as expected pursuant to Company policy.

Moreover, we frequently engage in a wide variety of activities and maintain relationships with a significant number of individuals and companies, including our affiliates and related parties in the digital asset industry. Although we have guidelines in place that are designed to prevent and protect against conflicts of interest, these activities and relationships could create actual or potential conflicts of interests in management decisions that we make.

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Inappropriate or unauthorized use of social media platforms, including blogs, social media websites and other forms of internet-based communications, which allow individuals access to a broad audience of consumers and other interested persons by our employees, agents or affiliates, could increase our costs, cause damage to our brand, lead to litigation or, expose us to liability, or result in information leakage. Despite our efforts to clearly define our mission and strategy and accurately characterize our investment products, our employees, agents or affiliates may engage in activities either in their official capacity, or in their unofficial capacities, that conflict with, or are incongruent, with our values. Any instance of such discontinuity could negatively impact our relationships with counterparties and investors in digital assets and our business, results of operations and reputation.

Despite our efforts, it is not always possible to deter misconduct or prevent errors, and the precautions we take to prevent and detect them may not be effective in all cases. If we were found to have not met our regulatory oversight and compliance and other obligations, then we could be subject to regulatory sanctions, financial penalties and restrictions on our activities for failure to properly identify, monitor and respond to potentially problematic activity, which could seriously damage our reputation. Our employees, agents and affiliates could also commit misconduct or errors that subject us to financial claims for negligence, as well as regulatory actions, or result in financial liability.

It may be difficult to evaluate our business and future prospects due to our limited operating history, concentrated exposure and the variability of our operating results.

We began our operations and introduced our first investment product, GBTC, in 2013 and have a limited operating history. Our historical growth should not be considered indicative of our ability to achieve or maintain growth in future periods. There is no assurance that we will be successful in growing our business, and the likelihood of success must be considered in light of our limited operating history. Even if we accomplish our growth objectives, we may not generate the anticipated cash flows or profits from such growth objectives. Furthermore, we have concentrated exposure to the digital asset industry, which would be further compounded by our Principal Investments for which we have no operating history, see “—We may not successfully implement our Principal Investments or realize its intended benefits”, and our operating results have been and will continue to be closely tied to conditions in the digital asset markets, which continue to be extremely volatile. Our operating results have in the past and may in the future vary considerably as a result of our concentrated exposure to such volatility. This limited operating history may make it difficult for investors to evaluate our business and future prospects.

In addition, our limited operating history may limit our ability to accurately forecast our future results of operations, including our ability to plan for and model future growth, as well as uncertainties and volatility underpinning the digital asset industry. For example, our revenues and expenses may fluctuate due to costs associated with new investment products, which may adversely impact our results of operations. Additionally, we have encountered, and may in the future encounter, risks and uncertainties frequently experienced by growing companies in rapidly changing industries, such as unforeseen operating expenses, difficulties, complications, delays and other known or unknown factors that may result in losses in future periods. If our results of operations do not meet our expectations in future periods, then our business, financial condition and results of operations may be harmed.

We rely on Coinbase Custody to provide us and our investment products with critical custody services for a substantial amount of the digital assets for which we offer investment products, including the digital assets and investment products that would be part of our Principal Investments. The failure of Coinbase Custody or other custodians to adequately safeguard these digital assets, or any disruptions to its services, could materially adversely affect our business and harm investors in our investment products.

We rely on Coinbase Custody Trust Company, LLC (“Coinbase Custody”), which is a “qualified custodian” for purposes of Rule 206(4)-2(d)(6) under the Investment Advisers Act of 1940, as amended (the “Investment Advisers Act”), with respect to the digital assets underlying our investment products, including the digital assets and investment products that would be part of our Principal Investments, to provide us and our investment products with critical custody services. We have also entered into custody agreements with Anchorage Digital Bank N.A. (“Anchorage”) and BitGo Trust Company, Inc. (“BitGo”), which are also both qualified custodians, and may increase the amount of assets we custody with BitGo and Anchorage or other digital asset custodians in the future. The failure of Coinbase Custody or other custodians to adequately safeguard such digital assets, or any disruptions to its business operations resulting from business failures, financial instability, insolvency, security failures, regulatory changes, operational problems or other factors, could have an adverse impact on our ability to access critical services, be disruptive to our operations and impact our AUM and revenues. Such disruptions could require us to replace the affected Custodian. See “—We rely on third-party service providers, which subjects us to risks that we may not be able to control or remediate.”

If we decide, or are required, to replace Coinbase Custody, Anchorage or BitGo (each a “Custodian” and collectively, the “Custodians”) as the custodian of a particular investment product’s digital assets, then transferring maintenance responsibilities of the custody accounts that store private keys to another custodian may be complex. Such transfer could subject digital assets to the risk of loss. We may be unable to replace the Custodian with respect to us and any of our investment products, in which case we could be required to dissolve that particular investment product and liquidate its assets. Such a scenario could adversely affect our business, operating results and financial condition.

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In addition, we rely on the security procedures and infrastructure of the Custodians to safeguard the digital assets underlying our investment products, including the digital assets and investment products that would be part of our Principal Investments, which could be impacted by hacks or other malicious actions directed at the Custodians, thus putting our digital assets at risk. Coinbase Custody’s maximum liability to us in respect of each cold storage address that holds digital asset is limited to $100 million. As a result, the applicable investment product would not have a claim against Coinbase Custody with respect to the digital assets held in such address to the extent the value exceeds $100 million. There is no guarantee that the Custodians will maintain adequate insurance or that insurance coverage will cover such loss. Damage to the infrastructure or the loss of private keys may render the digital assets inaccessible and adversely impact the value of the digital assets in question. In addition, changes to the protocol, like forks, could damage the reputation of digital assets or materially adversely affect our business.

Moreover, the legal rights of investors with respect to digital assets held on their behalf by a third-party custodian, such as the Custodians, are currently uncertain in insolvency proceedings. The custody agreements among us, our investment products and the applicable Custodian contain an agreement to treat the digital assets credited to our custody accounts as financial assets under Article 8 of the Uniform Commercial Code (“Article 8”), in addition to stating that the applicable Custodian will serve as custodian on our and our investment products’ behalf. Coinbase Custody’s parent, Coinbase Global, Inc. (“Coinbase Global”), has stated in its public securities filings that in light of the inclusion in its custody agreements of provisions relating to Article 8, it believes that a court would not treat custodied digital assets as part of its general estate in the event Coinbase Custody were to experience insolvency. However, due to the novelty of digital asset custodial arrangements, courts have not yet considered this type of treatment for custodied digital assets, and it is not possible to predict with certainty how courts would rule in such a scenario. If a Custodian became subject to insolvency proceedings and a court were to rule that the custodied digital assets were part of the Custodian’s general estate (and not our property or the property of our investment products), then we and our investment products could be treated as general unsecured creditors in the Custodian’s insolvency proceedings. We and our investment products could then be subject to the loss of all or a significant portion of their digital assets.

We rely on third-party service providers, which subjects us to risks that we may not be able to control or remediate.

We outsource some of our operational activities and accordingly rely on relationships with many third-party service providers. Our operations could be interrupted if our third-party service providers experience any disruptions to their businesses resulting from business failures, financial instability, security failures including cybersecurity breaches, government-mandated regulation, operational problems or other factors.

We rely on third parties for certain services, including, but not limited to, custodial and brokerage services, creation and redemption of shares of our investment products, marketing, fund administration, IT systems and accounting and index price determination. In particular, we rely on financial intermediaries to facilitate the creation, and if available, the redemption, of shares of our investment products and the purchase and sale of the underlying digital assets in connection with such creation and redemption; marketing agents to review marketing materials and provide prospectuses to financial intermediaries and other marketing services; fund administrators to keep the operational records of our investment products, prepare and file certain regulatory filings and provide accounting services; and index providers to determine the index prices of the underlying digital assets for which we offer investment products.

These third parties may be subject to financial, legal, regulatory, and labor issues, cybersecurity incidents, data theft or loss, break-ins, computer viruses or vulnerabilities in their code, denial-of-service attacks, sabotage, acts of vandalism, loss, disruption, instability of third-party banking relationships, privacy breaches, service terminations, disruptions, interruptions and other misconduct. They are also vulnerable to damage or interruption from human error, power loss, telecommunications failures, fires, floods, earthquakes, hurricanes, tornadoes, pandemics and similar events.

Because of the inherent risk in our reliance on third parties to provide these services and to facilitate certain of our business activities, we face increased operational risks. See “—Risk Factors Related to Regulation, Litigation, Intellectual Property, Cybersecurity and Data Privacy—Cybersecurity incidents and other issues related to our information systems, technology and data may materially adversely affect us.”

In addition, these third parties may breach their agreements with us, disagree with our interpretation of contract terms or applicable laws and regulations, refuse to continue or renew these agreements on commercially reasonable terms or at all, fail or refuse to process transactions or provide other services adequately, take actions that degrade the functionality of our services, impose additional costs or requirements on us or our investment vehicles, or give preferential treatment to competitors. There can be no assurance that third parties that provide services to us or to our investment vehicles on our behalf will continue to do so on acceptable terms, or at all, or if they will be able to expand their services to meet our needs in the future.

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If these third-party service providers experience difficulties or can no longer provide their services or terminate their services for any reason, and we are unable to replace them on a timely basis, then our operations could be interrupted, including for a significant period, and the attractiveness of our investment products could be adversely affected. For example, if an index provider is unable to provide an index price for an investment product or we determine that its index price does not accurately reflect the market price of the underlying digital asset or that, in the event of a fork, it is based on an inappropriate underlying digital asset, then we may be required to use a different index provider, which could adversely affect the operation and attractiveness of our investment products. To the extent that we are unable to find a suitable replacement at all, we may be required to dissolve a particular investment product and liquidate its assets. Any of these events could adversely affect our business, financial condition and results of operations.

There can be no assurance that third parties that provide services to us or to our investment vehicles on our behalf will continue to do so on acceptable terms, or at all. If any third party does not adequately or appropriately provide its services or perform its responsibilities to us or our investment vehicles on our behalf, such as if third-party service providers close their data center facilities without adequate notice, are unable to restore operations and data, fail to perform as expected or experience other unanticipated problems, we may be unable to procure alternatives in a timely and efficient manner and on acceptable terms, or at all, and we may be subject to business disruptions, losses or costs to remediate any of the deficiencies, customer dissatisfaction, reputational damage, legal or regulatory proceedings or other adverse consequences, which could adversely affect our business, financial condition and results of operations.

Our inability to maintain adequate relationships with third-party banking partners may adversely affect our business, financial condition and results of operations.

We may be harmed by the loss of any third-party banking partners. As a result of the many regulations and regulatory uncertainties applicable to digital assets, the risks of digital assets generally, and pressure from their regulators, many financial institutions have decided, and others may in the future decide or be forced, to not provide bank accounts or access to bank accounts, payment services or other financial services to companies providing investment products holding digital assets. A number of such companies have had their existing bank accounts closed by their banking partners. Any inability to procure or keep banking services would have a material and adverse effect on us. Similarly, continued general banking difficulties may decrease the utility or value of digital assets or harm public perception of these assets.

For example, in March 2023, Silicon Valley Bank and Signature Bank were placed into receivership. Also, in March 2023, Silvergate Bank announced plans to wind down and liquidate its operations. Following these events, a number of companies that provide digital asset-related services have been unable to find banks that are willing to provide them with bank accounts and banking services. Although these events did not have a material impact on Grayscale or any of our investment products, it is possible that a future closing of a bank with which Grayscale or any of our investment products has a financial relationship could subject us or our investment products to adverse conditions and pose challenges in finding an alternative suitable bank to provide Grayscale or our investment products with bank accounts and banking services.

Consequently, if we cannot maintain sufficient relationships with the third-party banking partners that provide these services, banking regulators restrict or prohibit banking of digital asset businesses, or these banking partners impose significant operational restrictions, then it may be difficult for us to find alternative banking partners, which may result in a disruption of our business and have an adverse effect on our reputation, business, financial condition and results of operations.

Our business depends on attracting and retaining our management team and other key personnel, the failure of which could disrupt our operations and adversely affect our business.

Because we operate in a relatively new industry that requires skilled personnel with specific knowledge and expertise, the future success of our business depends on the services of our management team and other key personnel for conducting our business, developing new investment products, managing our Principal Investments, and establishing and maintaining relationships with key business counterparties. Our policy has been to provide members of our management team and other key personnel with a supportive professional working environment and compensation and benefits that we believe are competitive with other companies in the digital asset investment industry. Nonetheless, they may choose to quit Grayscale in favor of other pursuits.

In addition, our ability to recruit and retain new members of our management team and other key personnel depends on a number of factors, including, but not limited to, a competitive labor market, our ability to offer competitive salaries and equity incentive programs, and our brand and reputation. As we grow and evolve, we may need to implement more complex organizational management structures, adapt our corporate culture and work environment, streamline our organization or adjust the size and structure of our workforce to scale and execute our long-term growth plans. These changes could have an adverse impact on our culture and employee morale, which could, in turn, adversely affect our reputation as an employer and harm our ability to recruit and retain high-quality members of our management team and other key personnel.

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The loss of any member of our management team or other key personnel, and our inability to recruit individuals to replace them, could disrupt our operations and adversely affect our business.

Our officers, directors, employees and large shareholders may have conflicts of interest with respect to their positions or interests in certain entities and other initiatives.

We frequently engage in a wide variety of transactions and maintain relationships with a significant number of third parties in connection with our platform. These transactions and relationships could create potential conflicts of interest in management decisions that we make. For instance, certain of our officers, directors and employees are active investors in digital asset projects and other growth companies, and may make investment decisions that favor projects in which they have personally invested. Certain of our large shareholders also make investments in these projects. As we expand our operations and the number of offerings on our platform, we may confront increasing numbers of potential conflicts of interest related to our officers’ and directors’ trading activity. If we fail to manage these conflicts of interests, our business may be harmed and our brand, reputation and credibility may be adversely affected.

The success of any of our hedging strategies is subject to risks and uncertainties.

We have in the past used, and may in the future continue to use, a number of financial instruments and derivatives, such as options, swaps and forward contracts, to hedge our exposures, including, but not limited to: protect against possible changes in the market value of our assets resulting from volatility in the digital asset markets and changes in interest rates; protect unrealized gains in the value of our digital assets or our management fees receivable paid in digital assets; facilitate the sale of any of our digital assets; hedge the interest rate risk on any of our assets or liabilities; or to any other end that we deem appropriate.

The success of any of our hedging strategies will depend, in part, on our ability to correctly assess the degree of correlation between the performance of our financial instruments and derivatives and the performance of the assets being hedged. Since the characteristics of many assets change as the markets evolve or time passes, the success of our hedging strategies will also be subject to our ability to continually recalculate, readjust and execute hedges in an efficient and timely manner. In addition, while we may enter into hedging transactions to reduce risks, such transactions may actually increase risks or result in a poorer overall performance for us than if we had not engaged in such transactions.

Any acquisitions, partnerships or joint ventures that we make or enter into could require significant management attention, disrupt our business and harm our financial condition.

We may in the future seek to acquire or invest in businesses, products or technologies that we believe could complement or expand our platform, enhance our technical capabilities or otherwise offer growth opportunities. The pursuit of potential acquisitions may divert the attention of management and cause us to incur various expenses in identifying, investigating and pursuing suitable acquisitions, whether or not such acquisitions are completed. In addition, we have limited experience in acquiring other businesses. We may not successfully identify desirable acquisition targets, or if we acquire additional businesses, we may not be able to integrate them effectively or obtain the expected benefits of the acquisition on a timely basis or at all. Acquisitions could also result in dilutive issuances of equity securities or the incurrence of debt, as well as unfavorable accounting treatment and exposure to claims and disputes by third parties, including intellectual property claims, indemnification claims, regulatory claims and earn-out obligations, which may not currently exist and cannot be accurately predicted. We may also not generate sufficient financial returns to offset the costs and expenses related to any acquisitions. In addition, if an acquired business fails to meet our expectations, our business, financial condition, cash flows and results of operations may suffer. Further, regulators may scrutinize our proposed business combinations and acquisitions given the regulatory landscape in which we operate, and regulatory approvals may be required for the completion of certain business combinations or acquisitions. We may be unable to pursue opportunities that would be beneficial to our business, which would be harmful to our business and financial condition.

Geopolitical events or macroeconomic conditions outside of our control could adversely affect our AUM, revenues and net income.

Our AUM, revenues and net income are subject to geopolitical events and macroeconomic conditions outside of our control, and their impact on the digital asset markets and investors in digital assets. The United States and other key international economies have experienced cyclical downturns from time to time in which economic activity declined, resulting in lower consumption rates, restricted credit, reduced profitability, weaknesses in financial markets, bankruptcies and overall macroeconomic uncertainty. Such adverse macroeconomic conditions have impacted in the past, and may impact in the future, the digital asset economy, although the extent of such impacts remains uncertain and dependent on a variety of factors, including, but not limited to, market adoption and acceptance of digital assets, global trends in the digital asset economy, central bank monetary policies, instability in the global banking system, volatility and disruptions in the capital and credit markets, and other events beyond our control. For example, in the past, capital and credit markets have experienced extreme volatility and disruptions, resulting in steep declines in the value of digital assets. Geopolitical events, such as trade wars, tariffs and foreign exchange limitations, can also increase the severity and levels of unpredictability globally

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and increase the volatility of global financial and digital asset markets. To the extent macroeconomic conditions and digital asset markets materially deteriorate, or any decline continues for a prolonged period, our AUM, revenues and net income, as well as our ability to attract investors in our investment products, could be adversely affected. Moreover, even if macroeconomic conditions were to improve or otherwise not deteriorate, there is no guarantee that the digital asset economy would similarly improve or not deteriorate.

Further, in 2022 and 2023, a number of blockchain protocols and digital asset financial companies suffered from insolvency and liquidity crises. Some of these events are alleged, or have been held, to be the result of fraudulent activity by insiders, including misappropriation of customer funds and other illicit activity and internal controls failures. In connection with these events, concerns were raised about the potential for a market condition where the failure of one company leads to the financial distress of other companies in the digital asset industry, which has the potential to depress the prices of digital assets used as collateral by other companies. If such a market condition were to become widespread in the digital asset economy, then we could suffer from reduced interest by investors in our investment products. Further, forced selling of digital assets by distressed companies could lead to lower digital asset prices.

Moreover, actual events involving limited liquidity, defaults, nonperformance or other adverse developments that affect financial institutions, transactional counterparties or other companies in the financial services industry, or the financial services industry generally, or concerns or rumors about any such events or other similar risks, have in the past, and may in the future, lead to market-wide liquidity problems. For example, in March 2023, Silicon Valley Bank and Signature Bank were accepted into receivership, and Silvergate Bank announced plans to wind down and liquidate its operations. In connection with these issues and issues with other financial institutions, the prices of certain fiat-backed stablecoins were temporarily impacted, which negatively impacted investor perception of digital assets and their perceived riskiness as an asset class and may be similarly impacted again in the future. In addition, a number of digital asset companies were unable to find banks that were willing to provide them with bank accounts and banking services. Although these events did not have a material impact on us, it is possible that a future closing of a bank with which we have a financial relationship could subject us to adverse conditions and pose challenges in finding an alternative suitable bank.

If the unpredictability or volatility resulting from geopolitical events or macroeconomic conditions continues or worsens, then there could be additional negative ramifications, such as additional market-wide liquidity problems or limitations on access to deposits and investments for customers of affected banks and certain banking partners, and our AUM, revenues and net income could be adversely affected.

Catastrophic and unpredictable events could have a material adverse effect on our business, financial condition or results of operations.

An act of terrorism, war, pandemic, cyberattack, power failure, natural disaster or a catastrophic or unpredictable event could have a material adverse effect on our business, financial condition or results of operations. Acts of terrorism, war, labor activism or unrest and other geopolitical events could cause disruptions to our operations or the economy as a whole. In the event of a pandemic, a natural disaster, including a major earthquake, blizzard or hurricane or a catastrophic event, including a cyberattack or power or telecommunications failure, we may be unable to continue our operations and endure reputational harm, delays in the development of new investment products, disruptions in the delivery of mining or validating equipment in connection with the digital assets for which we offer investment products or breaches of data security and loss of critical data, all of which could have an adverse effect on our results of operations. Such events could also affect the health and productivity of our employees. If pandemics, natural disasters or catastrophic events concurrently impact the data centers that we rely on, then our operations may be delayed, and we may suffer additional losses, both financial and otherwise. In addition, a failure of the exchanges on which our investment products’ shares trade to function properly could cause a material disruption to our business. We do not maintain insurance sufficient to compensate us for the potentially significant losses that could result from these disruptions, the effects of which may be further increased if we do not implement a disaster recovery plan.

Further, catastrophic and unpredictable events could affect the ability of our third-party service providers to continue to provide essential services, including, but not limited to, custodial and brokerage services, creation and redemption of shares of our investment products, marketing, fund administration and accounting, index price determination and IT and telecommunications systems. If we or our service providers are unable to respond adequately or in a timely fashion, then these failures may result in a loss of revenues or increased expenses, either of which would have a material adverse effect on our business, financial condition or results of operations.

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Digital assets and their underlying networks and other cryptographic and algorithmic protocols governing the creation, transfer and usage of digital assets represent a new and rapidly evolving industry. For example, the first digital asset, Bitcoin, was launched in 2009. Ether was launched in 2015 and, along with Bitcoin, was one of the first cryptographic digital assets to gain global adoption and critical mass. Our results of operations may be closely correlated with the development, acceptance and adoption of Bitcoin, Ether or other digital assets as the industry continues to evolve. The realization of one or more of the following risks could materially adversely affect our results of operations:

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Generally, digital assets have only recently become selectively accepted as a means of payment by retail and commercial outlets, and use of digital assets by consumers remains limited. Banks and other established financial institutions, whether voluntarily or in response to regulatory feedback, may refuse to process funds for transactions denominated in digital assets; process wire transfers to or from digital asset trading platforms, digital asset-related companies or service providers; or maintain accounts for persons or entities transacting in digital assets. As a result, the prices of digital assets generally may be largely determined by speculators, miners and validators, thus contributing to price volatility that makes retailers less likely to accept digital assets as a form of payment in the future.

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Banks may choose to not provide banking services, or may choose to cut off banking services, to businesses that provide digital asset-related services or that accept digital assets as payment, which could dampen liquidity in the market and damage the public perception of digital assets generally or any one digital asset in particular, and their or its utility as a payment system, which could decrease the prices of digital assets generally or individually.

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Certain digital assets are seen as a potential store of value, in part due to their limited supply, which may attract investors seeking to preserve their wealth during economic downturns. However, adoption of digital assets as a store of value remains limited because of, among other things, the volatility of digital asset prices.

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Users, developers, miners and validators may switch to, or adopt, certain digital asset networks at the expense of their engagement with other networks, which may negatively impact the digital assets supported by latter networks.

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In recent years, several federal and state regulatory bodies, such as the SEC, have brought enforcement actions against participants in the digital asset industry. In addition, several companies in the industry, such as BlockFi, Celsius, Voyager, FTX and Three Arrows Capital in 2022 and the Genesis Entities in 2023, have collapsed. The negative publicity associated with these events has decreased investor confidence in digital assets, and any similar events in the future could result in investors selling their digital assets in favor of investments that they perceive to offer lower risk.

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Many digital asset networks are in the early stages of developing partnerships and collaborations, all of which may not succeed and adversely affect the usability and adoption of the digital assets supported by these networks.

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Many digital asset networks have limited operating histories and are still in the process of developing and making significant decisions that will affect the design, supply, issuance, functionality and governance of their respective digital assets.

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Digital asset networks may not have implemented all software patches, upgrades and other changes required to maintain the safety of their protocols, which could introduce security issues, bugs, software errors or otherwise adversely affect the respective networks.

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A percentage of users and validators of a digital asset network could vote to create a soft or hard fork in a digital asset network, resulting in the operation of multiple separate networks, which could adversely affect their respective digital assets. Further, hard forks can result in contentious outcomes, leading some users to attempt to negatively impact the use or adoption of the digital asset network that forked. For example, in August 2017, Bitcoin forked and a new digital asset, Bitcoin Cash, was created, as a result of a years-long dispute over how to increase the rate of transactions on the Bitcoin network. This hard fork was contentious, and some users of the Bitcoin Cash network may harbor ill will toward the Bitcoin network.

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Certain privacy-preserving features have been or are expected to be introduced to a number of digital asset networks. Digital asset trading platforms or businesses that facilitate transactions in digital assets may be at an increased risk of criminal enforcement or civil lawsuits, or of having banking services cut off if there is a concern that these features interfere with the performance of AML duties and economic sanctions checks, and these features may become the target of government regulation and enforcement.

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Many digital asset networks are developing new features to address fundamental issues with respect to speed, scalability and energy usage. If these issues are not successfully addressed or do not receive widespread adoption, then they could adversely affect their respective digital assets.

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Digital asset mining operations can consume significant amounts of electricity, which may have a negative environmental impact and give rise to public opinion against, or government regulations restricting, the use of electricity for mining operations. Additionally, miners may be forced to cease operations during an electricity shortage or power outage, which could adversely affect digital asset networks.

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Security issues, bugs and software errors have been identified with many digital assets and their underlying networks, some of which have been exploited by malicious actors. There are also inherent security weaknesses in some digital assets, such as when creators of certain digital asset networks use procedures that could allow hackers to counterfeit tokens. Any weaknesses identified with a digital asset could adversely affect its price, security, liquidity and adoption. If a malicious actor or botnet (a collection of computers controlled by networked software coordinating the actions of the computers) obtains a majority of the processing or validating power on a digital asset network, as has happened in the past, then it may be able to manipulate transactions on or otherwise alter the underlying network, which could cause financial losses to holders, damage the network’s reputation and security and adversely affect the network’s value. Moreover, the functionality of that network may be negatively affected such that it is no longer attractive to users, thereby dampening demand for the overlying digital asset. Even if another digital asset were affected by similar circumstances, then any reduction in confidence in the source code or blockchain technology underlying digital assets could negatively affect the demand for digital assets generally.

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The development of new technologies for mining, such as improved application-specific integrated circuits (commonly referred to as ASICs), or changes in industry patterns, such as the consolidation of processing or validating power in a small number of large mining or validating pools, could reduce the security of digital asset networks, lead to increased liquid supply of digital assets and reduce a digital asset’s price and attractiveness.

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The open-source structure of many digital asset network protocols means that developers and other contributors, including those whose contributions may be important to the protocol, are not always directly compensated for their contributions in developing and maintaining such protocols. As a result, developers and other contributors of a particular blockchain or digital asset may lack a financial incentive to maintain or develop the network or may lack the resources to adequately address emerging issues. Alternatively, some developers and other contributors may be funded by companies whose interests are at odds with other participants in a particular digital asset network. A failure to properly monitor and upgrade protocols could damage that network.

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Certain blockchains permit concentrated ownership or an “admin key,” allowing a small group of holders to have significant unilateral control and influence over key decisions related to their underlying networks, such as governance decisions and protocol changes, as well as the prices of such digital assets.

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Certain blockchains or protocols use decentralized forms of governance that are evolving and may not be capable of making critical decisions in a timely or organized manner.

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The discovery of technological issues that result in disabled functionalities, exposure of users’ personal information, theft of users’ assets and other negative consequences could require resolution with the attention and efforts of global miner, validator, user and development communities.

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Potential use cases for digital assets, such as smart contracts, remain uncertain, have not received widespread adoption and are subject to additional risks. For example, since smart contracts typically cannot be stopped or reversed, vulnerabilities in their programming or design can have damaging effects. Further, smart contracts have been manipulated, exploited or used in ways that were not intended or envisioned by their creators.

Digital assets, on which our business is based and on which our results of operations may be closely correlated, are a new asset class that represents a technological innovation subject to a high degree of uncertainty, and there is no assurance that digital assets will maintain their value over the long term. The development, acceptance and adoption of digital assets will require greater regulatory clarity and growth in usage and in the underlying blockchain technologies for various applications. In addition, the value of digital assets is subject to risks related to their usage. If growth in usage generally occurs in the near or medium term, then there is no assurance that such usage will continue to grow over the long term. A contraction in usage may result in increased volatility or declines in digital asset prices, which would materially adversely affect our results of operations.

The prices of digital assets have experienced extreme volatility in recent periods and may continue to do so and could adversely affect our results of operations.

The prices of digital assets have historically been highly volatile, based partly on market acceptance, adoption and future expectations, which may or may not be realized. A significant portion of demand for digital assets may be generated by speculators and investors seeking to profit from the short- or long-term holding of these assets. Speculation regarding future appreciation in the value of a digital asset may inflate and make the price of that digital asset more volatile.

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Several factors may affect the prices of digital assets and could adversely affect our results of operations, including, but not limited to:

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Global digital asset supply and demand, which can be influenced by increases or decreases in the usage of digital assets and the investment and trading activities of large investors that invest directly or indirectly in digital assets;

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The financial strength of digital market participants generally;

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The availability and cost of funding and capital;

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The availability of banking and payment services to support digital asset-related projects;

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The speed and rate at which a digital asset is able to gain acceptance and adoption as a medium of exchange, utility, store of value, consumptive asset, security instrument or other financial asset, if at all;

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The development and availability of an active derivatives market for digital assets;

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The fees associated with the processing of digital asset transactions and the speed at which such transactions are settled, including on the underlying digital asset networks and digital asset trading platforms;

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The development and launch timeline of new digital asset networks and technologies and forthcoming upgrades designed to improve network scalability;

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Changes in the software, software requirements or hardware requirements underlying a digital asset network, such as a fork. Forks in the future are likely to occur, and there is no assurance that such a fork would not result in a sustained decline in the market prices of digital assets;

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The maintenance, troubleshooting and development of the open-source software protocol of digital assets and the digital asset networks underlying digital assets, including by miners, validators and developers;

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Ongoing technological viability and security of digital assets and their associated smart contracts, applications and networks, including vulnerabilities against hacks and scalability;

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Activities of stablecoin issuers, the ability of stablecoin issuers to substitute underlying assets to back the stablecoins or the decline in value of those underlying assets and future actions relating to the regulatory or accounting treatment of stablecoins;

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Changes in the rights, obligations, incentives or rewards for the various participants in a digital asset network, including in connection with block reward halving events, whereby the fixed reward for solving a new block is automatically halved after a certain number of blocks are solved. For digital assets that rely on miners or validators, sophisticated mining or validating groups may become unduly influential over time if system or bandwidth requirements become too high. Where a single personality or entity exerts an outsize influence, an adverse event impacting that individual or entity, such as an insolvency proceeding, could result in a reduction in the price of a digital asset;

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Concentration of ownership in certain digital assets by an individual or small group of holders or those within one or a small number of jurisdictions. Large sales or distributions by such holders could have an adverse effect on the prices of such digital assets;

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Digital asset trading platforms’ deposit and withdrawal policies and practices, liquidity and increase or decrease in trading volume and interruptions in service from or failures of such trading platforms;

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Increased competition from other digital assets on networks that exhibit better speed, security, scalability or other characteristics, and from other forms of payment services;

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Actual or perceived manipulation of digital asset markets and digital asset trading platforms, many of which may be unregulated;

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Actual or perceived threats that digital assets and related activities, such as mining and validating, have adverse effects on the environment or are tied to illegal activities, or on the other hand, the correlation of the prices of certain digital assets to the price of Bitcoin in particular;

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Negative publicity relating to, and unpredictable media (including social media) coverage of, digital assets and the digital asset industry;

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Listing or other business decisions by digital asset companies relating to specific digital assets;

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The ability of digital assets and digital asset trading platforms to meet user and investor demands and changing consumer preferences;

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Investors’ and users’ overall confidence in the digital asset investment ecosystem and the safety and reliability of digital asset trading platforms and digital wallets that hold digital assets;

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Levels of, and investors’ expectations with respect to, interest rates, rates of inflation of fiat currencies or digital assets and rates of return on digital asset trading platforms;

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Monetary policies of governments, trade restrictions, fiat currency devaluations and revaluations and regulatory measures, changes or enforcement actions that affect the use and value of digital assets, including with respect to the security status of digital assets generally;

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Judicial pronouncements related to digital assets, including the treatment of digital assets in certain types of insolvencies;

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Changing and uncertain regulatory perception and treatment of digital assets;

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The taxation, and tax-related reporting, of transactions involving digital assets by the United States and other jurisdictions; and

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Global or regional political, economic or financial conditions, events and situations, including market conditions across the digital asset industry specifically.

Additionally, some purportedly decentralized digital assets may be more centralized than widely believed, or may become more centralized over time, increasing the risk that an adverse event impacting an individual personality or entity could result in reductions in the prices of digital assets. While digital assets networks may purport to be decentralized without the need for reliance on any single government or institution to create, transmit and determine value, in fact, a single entity may have the ability to exert centralized authority over a network.

Further, some digital assets may be more difficult to value than other investments because such assets may not have a liquid or transparent trading market. For example, some digital asset trading platforms have created their own digital assets and used them in opaque and potentially fraudulent manners to facilitate transactions and trading relationships. In certain circumstances, such digital assets are thinly traded, making it difficult to ascertain the true value of such assets. We may not be able to sell a digital asset promptly or at a reasonable time or price. Although there may be an institutional market for certain digital assets, it is not possible to predict exactly how the market for such assets will develop or whether it will continue to exist. A digital asset that was liquid at the time of purchase may subsequently become illiquid, and its value may decline as a result.

There is no assurance that any digital asset will maintain its long-term value in terms of purchasing power in the future, or that acceptance of digital asset payments by mainstream retail merchants and commercial businesses will continue to grow. Only a limited number of digital assets have sometimes been accepted as a means of payment for some goods and services, and use of digital assets by consumers to pay at retail and commercial outlets remains very limited. In part, this is because many digital assets face scaling obstacles that can lead to high fees or slow transaction settlement times and attempts to increase the volume of transactions may not be effective. Banks and other established financial institutions may refuse to process funds for transactions denominated in digital assets; process wire transfers to or from digital asset trading platforms, digital asset-related companies or service providers; or maintain accounts for persons or entities transacting in digital assets. As a result, the prices of digital assets generally may be largely determined by speculators, miners and validators, thus contributing to price volatility that makes retailers less likely to accept digital assets as a form of payment. A lack of expansion by digital assets into retail and commercial markets, or a contraction of such limited use as has developed to date, may result in increased volatility or a reduction in the value of that digital asset or digital assets generally which may reduce our AUM and negatively affect our results of operations.

Digital asset networks face significant scaling challenges and efforts to increase the volume and speed of transactions may not be successful.

Many digital asset networks face significant scaling challenges due to the fact that public, permissionless blockchains generally face a tradeoff among decentralization, security and scalability. One means through which digital asset networks that utilize public, permissionless blockchains achieve security is through decentralization, meaning that no intermediary is responsible for securing and maintaining these systems. For example, many assert that a greater degree of decentralization of a public, permissionless blockchain generally means a given digital asset network is less susceptible to manipulation or capture. In practice, this typically means that each node on a given digital asset network is responsible for processing every transaction and maintaining a copy of the entire state of the network. As a result, a digital asset network that utilizes a public, permissionless blockchain may be limited in the number of transactions it can process by the computing capabilities of each single fully participating node. Many developers are actively researching and testing scalability solutions for public blockchains that do not necessarily result in lower levels of security or decentralization, such as off-chain payment channels and Layer 2 networks. Off-chain payment channels would allow parties to transact without requiring the full processing or validating power of a blockchain. Layer 2 networks can increase the scalability of a blockchain by allowing users to transact on a second blockchain deployed on top of a “Layer 1” network. There is no guarantee that the scalability solutions that are being researched and tested by developers will be successful.

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As corresponding increases in throughput lag behind growth in the use of digital asset networks, average transaction fees and settlement times may increase considerably. For example, the Bitcoin and Ethereum networks have been, at times, at capacity, which has led to increased transaction fees. Since January 1, 2022, average daily transaction fees on the Bitcoin network have ranged from $0.38 per transaction on September 8, 2024, to as high as $124.17 per transaction on April 20, 2024, and average daily transaction fees on the Ethereum network have ranged from $0.56 per transaction, on August 31, 2024, to as high as $200.27 per transaction, on May 1, 2022. As of December 31, 2024, average daily transaction fees on the Bitcoin network stood at $1.79 per transaction, and average daily transaction fees on the Ethereum network stood at $3.52 per transaction. Increased transaction fees and decreased settlement speeds could preclude certain uses for digital assets (e.g., micropayments) and could reduce demand for, and the prices of, digital assets, and could adversely affect our results of operations.

Since the inception of the digital asset economy, numerous digital asset trading platforms have been sued, investigated or shut down due to fraud, manipulative practices, business failure and security breaches. In many of these instances, customers of these platforms were not compensated or made whole for their losses. Larger platforms are more appealing targets for hackers and malware and may also be more likely to be targets of regulatory enforcement actions. For example, in February 2021, Bitfinex settled a long-running legal dispute with the State of New York related to Bitfinex’s alleged misuse of over $800 million of customer assets and, in October 2023, hackers were reported to have stolen $570 million from the BNB Smart Chain, a blockchain linked with Binance Holdings Ltd. (“Binance”), which operates one of the world’s largest digital asset trading platforms. In February 2025, the digital asset trading platform Bybit reportedly lost approximately $1.5 billion in Ether through a hacker-induced transfer from its cold wallet to a wallet address said to be associated with the Lazarus Group (a hacker group believed to be run by the government of North Korea). Further, in 2022 and 2023, each of BlockFi, Celsius, Voyager, Three Arrows Capital, FTX and the Genesis Entities declared bankruptcy. In particular, in November 2022, it was revealed that FTX, at the time one of the world’s largest and most popular digital asset trading platforms, had been misusing customer assets, resulting in a loss of confidence in participants of the digital asset economy and negative publicity surrounding digital assets more broadly. The U.S. Department of Justice subsequently brought criminal charges, including charges of fraud, violations of federal securities laws, money laundering and campaign finance offenses, against FTX’s former CEO and others. In November 2023, FTX’s former CEO was convicted of fraud and money laundering.

The SEC also brought charges against Genesis Capital and Gemini Trust Company, LLC (“Gemini”) in January 2023 for their alleged unregistered offer and sale of securities to retail investors. In March 2024, Genesis Capital settled the charges, agreeing to a final judgment ordering it to pay a $21 million civil penalty.

Further, in June 2023, the SEC initiated lawsuits against Coinbase, Inc. (“Coinbase”) and Binance alleging, among other things, that such firms were operating as unregistered securities exchanges in the United States and identifying a number of digital assets that the SEC alleges to be unregistered securities. In addition, in November 2023, the SEC filed a complaint against Payward, Inc. and Payward Ventures, Inc. (together known as “Kraken”) and brought similar charges, including an allegation that Kraken operated as an unregistered securities exchange, brokerage and clearing agency. In November 2023, Binance pleaded guilty in connection with the Justice Department’s investigations into violations relating to the Bank Secrecy Act of 1970, as amended (“BSA”), and failure to register as a money transmitting business and the International Emergency Economic Powers Act, and the founder of Binance pleaded guilty to failing to maintain an effective AML program in violation of the BSA. As part of the settlement, Binance separately reached resolutions with the CFTC, Financial Crimes Enforcement Network (“FinCEN”) and the Treasury Department’s Office of Foreign Assets Control (“OFAC”). In February 2025, Coinbase and the SEC entered into a court-approved joint stipulation to dismiss the SEC’s lawsuit with prejudice. In March 2025, Kraken and the SEC jointly dismissed the SEC’s lawsuit with prejudice. In May 2024, Binance and the SEC jointly dismissed the SEC’s lawsuit with prejudice. Several other digital assets market participants have also announced that the SEC informed them that the SEC was terminating its investigation or enforcement action into their firm. Further, the Justice Department in April 2025 issued a memorandum indicating that it will prioritize cases related to digital assets’ use in crimes of fraud, terrorism, drugs and human trafficking, organized crime, hacking and gang financing, and that other sorts of cases related to digital assets will be deprioritized. The final outcome of these and other lawsuits (to the extent not yet dismissed), their effect on the broader digital asset investment ecosystem and the reputation impact on industry participants, remain uncertain. Such litigation has led, and this or other litigation in the future may lead, to further volatility in digital asset prices.

In addition, there have been reports that a significant amount of trading volume on digital asset trading platforms is fabricated and false in nature. Such reports may indicate that the market for digital asset trading platform activities is significantly smaller than otherwise understood.

Negative perception, a lack of stability and standardized regulation in the digital asset economy, and the closure or temporary shutdown of digital asset trading platforms due to fraud, business failure, hackers or malware, or government-mandated regulation, and associated losses suffered by customers may reduce confidence in the digital asset economy and result in greater volatility of the prices of digital assets, including significant depreciation in value. Any of these events in the digital asset economy could adversely affect our reputation, business and financial condition.

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Many digital asset transactions are irrevocable and stolen or incorrectly transferred digital assets may be irretrievable. As a result, any incorrectly executed digital asset transaction could adversely affect our results of operations.

Digital asset transactions recorded on a blockchain ledger are typically not reversible without the consent and active participation of the recipient of the transaction. Once a transaction has been verified and recorded in a block that has been added to the blockchain, an incorrect transfer or theft of a digital asset generally will not be reversible. We may not be capable of obtaining compensation for any such transfer or theft. Although transfers of digital assets custodied by a Custodian on behalf of our investment products, including the digital assets and investment products that would be part of our Principal Investments, will regularly be made to or from our custody accounts, it is possible that, through computer or human error, or through theft or criminal action, such digital assets could be transferred from our custody accounts in incorrect amounts or to unauthorized third parties, or to uncontrolled accounts.

Such events have occurred in connection with digital assets in the past. To the extent we are unable to seek a corrective transaction with the recipient of an incorrect transfer of digital assets or identify the third party which has received digital assets through theft, we will be unable to revert or otherwise recover such digital assets. We will also be unable to convert or recover any digital assets transferred to uncontrolled accounts. Such loss could materially adversely affect our results of operations.

The U.S. federal income tax treatment of transactions in digital assets is unclear.

Due to the new and evolving nature of digital assets and the absence of comprehensive guidance with respect to digital assets, many significant aspects of the U.S. federal income tax treatment of digital assets are uncertain. Our operations and dealings, in or in connection with digital assets, as well as transactions in digital assets generally, could be subject to adverse tax consequences in the United States, including as a result of development of the legal regimes surrounding digital assets, and the prices of digital assets, as well as our results of operations, could be adversely affected thereby.

Many significant aspects of the U.S. federal income tax treatment of digital assets (including with respect to the amount, timing and character of income recognition) are uncertain. In 2014, the U.S. Internal Revenue Service (the “IRS”) released a notice (the “Notice”) discussing certain aspects of certain digital assets for U.S. federal income tax purposes and, in particular, stating that such digital assets are “property”; are not “currency,” for purposes of the rules relating to foreign currency gain or loss; and may be held as capital assets. In 2019, the IRS released a revenue ruling and a set of “Frequently Asked Questions” (the “Ruling & FAQs”) that provide some additional guidance, including guidance to the effect that, under certain circumstances, hard forks of digital assets are taxable events giving rise to ordinary income and guidance with respect to the determination of the tax basis of digital assets. Moreover, in 2023, the IRS released a revenue ruling that provided guidance on digital asset staking, including guidance to the effect that staking rewards will, under certain circumstances, be treated as giving rise to taxable income (the “Staking Guidance”). However, the Notice, the Ruling & FAQs and the Staking Guidance do not address other significant aspects of the U.S. federal income tax treatment of digital assets. We do not intend to request a ruling from the IRS on these issues, and we will take positions on these and other U.S. federal income tax issues relating to digital assets that we believe to be reasonable. There can be no assurance that the IRS will agree with the positions we take, and it is possible that the IRS will successfully challenge our positions.

For example, certain of our investment products are intended to be grantor trusts for U.S. federal income tax purposes, but there is limited guidance regarding the treatment of investment products holding digital assets. In addition, certain of our investment products may be required to make determinations and take positions regarding uncertain tax consequences arising from digital assets they hold, including with respect to U.S. withholding taxes in respect of income from a fork, airdrop, or similar occurrence. If the IRS were to successfully challenge tax positions taken by any of our investment products, it could give rise to materially adverse tax consequences to both the investment product and its investors. Moreover, regulations, rulings or other guidance regarding digital assets could give rise to adverse tax consequences to our investment products by imposing additional tax on them or their investors or by requiring them to comply with burdensome reporting or withholding requirements.

There can be no assurance that the IRS will not alter its position with respect to digital assets in the future or that a court would uphold the treatment set forth in the Notice, the Ruling & FAQs and the Staking Guidance. It is also unclear what additional guidance on the treatment of digital assets for U.S. federal income tax purposes may be issued in the future. Any such alteration of the current IRS positions or additional guidance could result in adverse tax consequences for us and investors in our investment products and have an adverse effect on the value of digital assets. Because of the evolving nature of digital assets, it is not possible to predict potential future developments that may arise. Such developments may increase the uncertainty with respect to the treatment of digital assets for U.S. federal income tax purposes. For example, the Notice addresses only digital assets that are “convertible virtual currency” (that is, digital assets that have an equivalent value in fiat currency or act as substitutes for fiat currency), and it is conceivable that certain types of digital assets for which we offer investment products are not within the scope of the Notice.

On November 15, 2021, President Biden signed into law the Infrastructure Investment and Jobs Act (the “IIJA”). The IIJA implements a set of comprehensive tax information reporting rules that will apply to persons, including digital asset trading platforms and custodians, that regularly effect transfers of digital assets on behalf of other persons. In particular, these rules will require digital asset trading platforms and custodians to report certain digital asset transactions (including sales, exchanges and other transfers) effected

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on behalf of other persons on an annual return, in a manner similar to the current reporting rules for brokers that effect stock and other securities transactions on behalf of customers. In addition, the IIJA extends the reporting requirements for businesses that receive more than $10,000 in cash in a transaction (or related transactions) to transactions involving the receipt of digital assets with a fair market value of more than $10,000. However, such extension to transactions involving the receipt of digital assets has been postponed pending the issuance of regulations.

In July of 2024, the IRS and the U.S. Department of the Treasury released final regulations to implement certain of these reporting rules (the “July 2024 final regulations”). The July 2024 final regulations’ definition of the term “broker” is broad and, in a number of respects, is unclear in scope, but generally requires custodial brokers and brokers acting as principals to perform information reporting and backup withholding functions. Under the July 2024 final regulations and a notice released contemporaneously by the IRS and the U.S. Department of the Treasury, such reporting of cost basis information and backup withholding generally will apply in respect of transactions occurring on or after January 1, 2025, but certain transitional relief may be available for transactions occurring prior to January 1, 2026. The July 2024 final regulations do not address all aspects of the IIJA information reporting regime and their application is uncertain in a number of respects, including with respect to the collection and reporting of cost basis information for digital assets and the scope of transactions subject to reporting. In December of 2024, the IRS and the U.S. Department of the Treasury issued separate final regulations describing information reporting rules for noncustodial industry participants (the “December 2024 final regulations”), including the requirement to file information returns and furnish payee statements reporting gross proceeds on dispositions of digital assets effected for customers in certain sale or exchange transactions. The December 2024 final regulations were subsequently repealed under the Congressional Review Act on April 10, 2025, after President Trump signed into law a congressional joint resolution of disapproval providing that the December 2024 final regulations shall have no force or effect.

The effects of the IIJA reporting regime and its application to us may depend in significant part on further regulatory or other guidance from the IRS and could create significant compliance burdens and uncertainties in the digital asset market, and could affect the price of digital assets, which could have an adverse effect on our business.

The state, local and non-U.S. tax treatment of digital assets is unclear.

The taxing authorities of certain states have announced that they will follow the Notice with respect to the treatment of digital assets for state income tax purposes and/or have issued guidance exempting the purchase and/or sale of digital assets for fiat currency from state sales tax. It is unclear what further guidance on the treatment of digital assets for state tax purposes may be issued in the future. Any future guidance on the treatment of digital assets for state or local tax purposes could result in adverse tax consequences to investors in our investment products, adversely affect the prices of digital assets and our business.

The treatment of digital assets for tax purposes by non-U.S. jurisdictions may differ from the treatment of digital assets for U.S. federal, state or local tax purposes. It is possible, for example, that a non-U.S. jurisdiction would impose sales tax or value-added tax on purchases and sales of digital assets for fiat assets. For instance, if a foreign jurisdiction with a significant share of the market of Bitcoin users imposes onerous tax burdens on digital asset users, or imposes sales or value-added tax on purchases and sales of digital assets for fiat assets, then such actions could result in decreased demand for digital assets in such jurisdiction, which could adversely affect the prices of digital assets, our AUM and results of operations.

As digital assets have grown in both popularity and market size, the U.S. Congress and a number of U.S. federal and state agencies (including FinCEN, OFAC, SEC, CFTC, IRS, Federal Deposit Insurance Corporation (“FDIC”), Financial Industry Regulatory Authority (“FINRA”), Consumer Financial Protection Bureau (“CFPB”), Department of Justice (“DOJ”), Department of Homeland Security (“DHS”), Federal Bureau of Investigation (“FBI”), Office of the Comptroller of the Currency (“OCC”), the Board of Governors of the Federal Reserve System (the “Federal Reserve”) and state financial institution and securities regulators) have been examining the operations of digital asset networks, digital asset users and digital asset markets, with particular focus on the extent to which digital assets can be used to launder the proceeds of illegal activities, evade sanctions, or fund criminal or terrorist enterprises and the safety and soundness of trading platforms and other service providers that hold or custody digital assets for users. Many of these state and federal agencies have issued consumer advisories regarding the risks posed by digital assets to investors. Ongoing and future regulatory actions with respect to digital assets may alter, perhaps to a materially adverse extent, the nature of an investment in our investment products or our ability to continue to operate. Moreover, the failure of FTX in November 2022 and the resulting market turmoil substantially increased regulatory scrutiny in the United States and globally and led to criminal investigations, SEC enforcement actions and other regulatory activity across the digital asset investment ecosystem.

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In August 2021, the former chair of the SEC stated that he believed investors using digital asset trading platforms are not adequately protected, and that activities on the platforms can implicate the securities laws, commodities laws and banking laws, raising a number of issues related to protecting investors and consumers, guarding against illicit activity and ensuring financial stability. The former chair expressed a need for the SEC to have additional authorities to prevent transactions, products and platforms from “falling between regulatory cracks,” as well as for more resources to protect investors in “this growing and volatile sector.” The former chair called for federal legislation centering on digital asset trading, lending and DeFi platforms, seeking “additional plenary authority” to write rules for digital asset trading and lending. The SEC under the current administration, however, is taking a different approach to digital assets.

There have been several bills introduced in Congress that propose to establish additional regulation and oversight of the digital asset markets. Certain of these bills passed out of relevant committees and were passed in the House of Representatives in the last Congress, though not the Senate. Some of these bills have since been reintroduced with changes, and continue to be contemplated in the relevant committees, as well as the full House of Representatives and Senate. For example, in July 2025, the GENIUS Act was signed into law and the House of Representatives passed the Clarity Act in an effort to pass laws relating to digital asset market structure. It is difficult to predict whether, or when, any of these developments will lead to Congress granting additional authorities to the SEC or other regulators, what the nature of such additional authorities might be, how additional legislation and/or regulatory oversight might impact the ability of digital asset markets to function or how any new regulations or changes to existing regulations might impact the value of digital assets generally and those held by us specifically. The consequences of increased federal regulation of digital assets and digital asset activities could have a material adverse effect on our business and the market price of our Class A common stock.

Furthermore, changes in U.S. political leadership and economic policies may create uncertainty that materially affects the price of digital assets. For example, on March 6, 2025, President Trump signed an Executive Order to establish a Strategic Bitcoin Reserve and a United States Digital Asset Stockpile. Pursuant to this Executive Order, the Strategic Bitcoin Reserve will be capitalized with Bitcoin owned by the Department of Treasury that was forfeited as part of criminal or civil asset forfeiture proceedings, and the Secretaries of Treasury and Commerce are authorized to develop budget-neutral strategies for acquiring additional Bitcoin, provided that those strategies impose no incremental costs on American taxpayers. Conversely, the Digital Asset Stockpile will consist of all digital assets other than Bitcoin owned by the Department of Treasury that were forfeited in criminal or civil asset forfeiture proceedings, but the U.S. government will not acquire additional assets for the U.S. Digital Asset Stockpile beyond those obtained through such proceedings. The anticipation of a U.S. government-funded strategic cryptocurrency reserve had motivated large-scale purchases of various digital assets in the expectation of the U.S. government acquiring those digital assets to fund such reserve, and the market price of some digital assets decreased significantly as a result of the ultimate content of the Executive Order. Any similar action or omission by the U.S. federal administration or other government authorities may negatively and significantly impact the price of digital assets.

In addition, law enforcement agencies have often relied on the transparency of blockchains to facilitate investigations. However, certain privacy-enhancing features have been, or are expected to be, introduced to a number of digital asset networks. If the digital asset networks were to adopt any of these features, then these features may provide law enforcement agencies with less visibility into transaction-level data. Europol, the E.U.’s law enforcement agency, released a report in October 2017 noting the increased use of privacy-enhancing digital assets like Zcash and Monero in criminal activity. In August 2022, OFAC banned all transactions by U.S. persons or in the United States involving Tornado Cash, a digital asset protocol designed to obfuscate blockchain transactions, by adding Tornado Cash and certain Ethereum wallet addresses associated with the protocol to its Specially Designated Nationals and Blocked Persons List, though it has since removed the Tornado Cash smart contracts from this list. In October 2023, FinCEN issued a notice of proposed rulemaking that identified convertible virtual currency (“CVC”) mixing as a class of transactions of primary money laundering concern and proposed requiring covered financial institutions to implement certain recordkeeping and reporting requirements on transactions that covered financial institutions know, suspect or have reason to suspect involve CVC mixing within or involving jurisdictions outside the United States. In April 2024, the DOJ arrested and charged the developers of the Samourai Wallet mixing service with conspiracy to commit money laundering and conspiracy to operate an unlicensed money transmitting business. In May 2024, a co-founder of Tornado Cash was sentenced to more than five years imprisonment in the Netherlands for developing Tornado Cash on the basis that he had helped launder more than $2 billion worth of digital assets through Tornado Cash. In August 2025, a co-founder of Tornado Cash was convicted of conspiracy to operate an unlicensed money transmitting business, but a mistrial was declared with respect to charges of conspiracy to commit money laundering and conspiracy to violate U.S. sanctions. Additional regulatory action with respect to privacy-enhancing digital assets and protocols is possible in the future.

It is difficult to predict whether, or when, the U.S. Congress will grant additional authorities to the SEC or other regulators, what the nature of such additional authorities might be, how additional legislation or regulatory oversight might impact the ability of digital asset markets to function or how any new regulations or changes to existing regulations might impact the prices of digital assets. The consequences of increased regulation of digital assets, participants in the digital asset industry and digital asset activities could have a material adverse effect on our results of operations.

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Regulatory changes or other events in foreign jurisdictions may lead to restrictions in the use of digital assets, mining and validating activity or the operation of digital asset networks or digital asset markets in a manner that adversely affects the prices of digital assets and our results of operations.

Various foreign jurisdictions have adopted, and may continue to adopt, laws, regulations or directives that affect digital asset networks, digital asset markets and their users, particularly digital asset trading platforms and service providers that fall within such jurisdictions’ regulatory scope. For example, if foreign jurisdictions in addition to China were to ban or otherwise restrict mining and validating activity, including by regulating or limiting manufacturers’ ability to produce or sell semiconductors or hard drives in connection with mining and validating, then this would have a material adverse effect on digital asset networks and digital asset markets, and as a result, impact the prices of digital assets and our results of operations.

A number of foreign jurisdictions have recently taken regulatory action aimed at digital asset activities. China has made transacting in cryptocurrencies illegal for Chinese citizens in mainland China, and additional restrictions may follow. Both China and South Korea have banned initial coin offerings entirely, and regulators in other jurisdictions, including Canada, Singapore and Hong Kong, have opined that initial coin offerings may constitute securities offerings subject to local securities regulations. The U.K.’s Financial Conduct Authority (“FCA”) published final rules in October 2020 banning the sale of derivatives and exchange-traded notes that reference certain types of digital assets, contending that they are “ill-suited” to retail investors, citing extreme volatility, valuation challenges and association with financial crime. A new law, the Financial Services and Markets Act 2023 (“FSMA”), received royal assent in June 2023. The FSMA brings digital asset activities within the scope of existing laws governing financial institutions, markets and assets. In addition, the Parliament of the European Union approved the text of the Markets in Crypto Assets Regulation (“MiCA”) in April 2023, establishing a regulatory framework for digital asset services across the European Union. Certain parts of MiCA became effective as of June 2024 and the remainder became effective as of December 2024. MiCA is intended to serve as a comprehensive regulation of digital asset markets and imposes various obligations on digital asset issuers and service providers. The main aims of MiCA are industry regulation, consumer protection, prevention of market abuse and upholding the integrity of digital asset markets.

Foreign laws, regulations or directives may conflict with those of the United States and may negatively impact the acceptance of one or more digital assets by users, merchants and service providers outside the United States and may therefore impede the growth or sustainability of the digital asset economy in the United States and globally, or otherwise negatively affect the value of digital assets. The effect of any future regulatory changes or other events in foreign jurisdictions on the prices of digital assets is impossible to predict, and such changes or events could be substantial and adverse to our results of operations.

Due to the largely unregulated nature and lack of transparency surrounding the operations of digital asset trading platforms, they may experience fraud, market manipulation, business failures, security failures or operational problems, which may adversely affect the prices of digital assets and, consequently, our results of operations.

Digital asset trading platforms are relatively new and, in many ways, are not subject to, or may not comply with, regulation in relevant jurisdictions in a manner similar to other regulated trading platforms, such as national securities exchanges or designated contract markets. While many prominent digital asset trading platforms provide the public with significant information regarding their on-chain activities, ownership structure, management teams, corporate practices, cybersecurity practices and regulatory compliance, many other digital asset trading platforms do not provide this information. Furthermore, while some digital asset trading platforms are and may continue to be subject to federal and state licensing requirements in the United States, digital asset trading platforms do not currently appear to be subject to regulation in a similar manner as other regulated trading platforms, such as national securities exchanges or designated contract markets. As a result, the marketplace may lose confidence in such digital asset trading platforms, including prominent trading platforms that handle a significant volume of digital asset trading, which may adversely impact the value of digital assets and could have a material adverse effect on our results of operations.

Many digital asset trading platforms, both in the United States and abroad, are unlicensed, not subject to, or not in compliance with, regulation in relevant jurisdictions, or operate without extensive supervision by governmental authorities, and therefore may be more susceptible to fraudulent or manipulative acts and practices. In particular, those located outside the United States may be subject to significantly less stringent regulatory and compliance requirements in their local jurisdictions and may take the position that they are not subject to laws and regulations that would apply to a national securities exchange or designated contract market in the United States, or may, as a practical matter, be beyond the ambit of U.S. regulators. As a result, trading activity on, or reported by, these digital asset trading platforms is generally significantly less regulated than trading activity on or reported by regulated U.S. securities and commodities markets, and may reflect behavior that would be prohibited in regulated U.S. trading venues. For example, in 2022 one report claimed that trading volumes on digital asset trading platforms were inflated by over 70% due to false or non-economic trades, with specific focus on unlicensed digital asset trading platforms located outside of the United States. Such reports may indicate that the digital asset trading platform market is significantly smaller than expected and that the United States makes up a significantly larger percentage of the digital asset trading platform market than is commonly understood, or that a much larger portion of digital asset market activity takes place on DeFi platforms than is commonly understood. Nonetheless, any actual or perceived false trading in the digital asset trading platform market, and any other fraudulent or manipulative acts and practices, could adversely affect the prices of digital assets or negatively affect the market perception of digital assets, which could in turn adversely impact our results of operations.

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The SEC has also identified possible sources of fraud and manipulation in the digital asset markets generally, including, among others (1) “wash-trading”; (2) persons with a dominant position in a digital asset manipulating pricing in such digital asset; (3) hacking of the underlying digital asset network and trading platforms; (4) malicious control of the underlying digital asset network; (5) trading based on material, non-public information (for example, plans of market participants to significantly increase or decrease their holdings in a digital asset, new sources of demand for a digital asset) or based on the dissemination of false and misleading information; (6) manipulative activity involving purported “stablecoins”; and (7) fraud and manipulation on digital asset markets. The use or presence of such acts and practices in the digital asset markets could, for example, falsely inflate the volume of a digital asset present in the digital asset markets or cause distortions in the price of such digital asset, among other things that could adversely affect any digital assets for which we offer investment products, including the digital assets and investment products that would be part of our Principal Investments. Moreover, tools to detect and deter fraudulent or manipulative trading activities, such as market manipulation, front-running of trades, and wash-trading, may not be available to or employed by digital asset markets, or may not exist at all. Many digital asset markets also lack certain safeguards put in place by exchanges for more traditional assets to enhance the stability of trading on the exchanges and prevent “flash crashes,” such as limit-down circuit breakers. As a result, the prices of digital assets on digital asset markets may be subject to larger and/or more frequent sudden declines than assets traded on more traditional exchanges.

In addition, over the past several years, some digital asset platforms have been closed, been subject to criminal and civil litigation and have entered into bankruptcy proceedings due to fraud and manipulative activity, business failure and/or security breaches. In many of these instances, the customers of such digital asset trading platforms were not compensated or made whole for the partial or complete losses of their account balances in such digital asset trading platforms. In some instances, customers are made whole only in dollar terms as of the digital asset trading platform’s date of failure, rather than on a digital asset basis, meaning customers may still lose out on any subsequent price increase in digital assets.

While smaller digital asset trading platforms are less likely to have the infrastructure and capitalization that make larger digital asset trading platforms more stable, larger digital asset trading platforms are more likely to be appealing targets for hackers and malware and their shortcomings or ultimate failures are more likely to have contagion effects on the digital asset investment ecosystem, including on the price of Bitcoin and Ether, and therefore may be more likely to be targets of regulatory enforcement action. For more information on these events, see “—Due to a lack of familiarity and some negative publicity associated with digital asset trading platforms, existing and potential customers, counterparties and regulators may lose confidence in the digital asset industry.”

Negative perception, a lack of stability and standardized regulation in the digital asset markets and/or the closure or temporary shutdown of digital asset trading platforms due to fraud, business failure, security breaches or government mandated regulation, and associated losses by customers, may reduce confidence in digital asset networks and result in greater volatility in the prices of digital assets. Furthermore, the closure or temporary shutdown of a digital asset trading platform used in calculating the index price of one of our investment products may result in a loss of confidence in such investment product, negatively affecting our AUM and reducing our revenues.

Political or economic crises may motivate large-scale sales of digital assets, which would result in a reduction in values and materially adversely affect our results of operations.

Certain digital assets, as alternatives to fiat currencies that are backed by central governments, are subject to supply and demand forces based upon the desirability of an alternative, decentralized means of buying and selling goods and services, and it is unclear how such supply and demand will be impacted by geopolitical events. For example, political or economic crises could motivate large-scale acquisitions or sales of digital assets either globally, regionally or locally. Large-scale sales of certain digital assets would result in a reduction in their value and could materially adversely affect our results of operations.

The value of digital assets may be subject to momentum pricing risk.

Momentum pricing typically is associated with growth stocks and other assets whose valuation, as determined by the investing public, accounts for anticipated future appreciation in value. Digital asset market prices are determined primarily using data from various digital asset trading platforms, over-the-counter markets and derivative platforms. Momentum pricing may have resulted, and may continue to result, in speculation regarding future appreciation in the value of digital assets, inflating and making their market prices more volatile, and such effects may be material and adverse. As a result, digital assets may be more likely to fluctuate in value due to changing investor confidence in future appreciation (or depreciation) in their market prices, which could materially adversely affect our results of operations.

Digital asset networks, digital assets and the digital asset trading platforms on which these assets are traded are dependent on internet and other blockchain infrastructure and susceptible to system failures, security risks and rapid technological change.

The success of digital asset networks and platforms will depend on the continued development of a stable infrastructure, with the necessary speed, data capacity and security and the timely development of complementary products such as high-speed modems for

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providing reliable internet access and services. Digital assets have experienced, and are expected to continue to experience, significant growth in the number of users and amount of content. Blockchains will continue to be increasingly interconnected with other blockchains and real-world applications. As services and applications continue to be built on top of blockchains, there will be increased reliance on third-party infrastructure providers, including in connection with cross-chain bridges and messaging, liquidity providers, wallets, data feeds and oracles. Reliance on any of these third parties introduces additional risks and points of failure. There is no assurance that the relevant digital asset infrastructure will continue to be able to support the demands placed on it by continued growth of digital asset networks or that the performance or reliability of the technology will not be adversely affected by such continued growth. There is also no assurance that the infrastructure or complementary products or services necessary to make digital assets a viable product for their intended use will be developed in a timely manner, or that such development will not result in the requirement of incurring substantial costs to adapt to changing technologies. The failure of these technologies or platforms or the development of these technologies or platforms could materially adversely affect our results of operations. Any number of technical changes, software upgrades, soft or hard forks, cybersecurity incidents or other changes to the underlying digital asset network may occur from time to time, causing incompatibility, technical issues, disruptions or security weaknesses to our systems and negatively impacting our operations.

If we are unable to identify, troubleshoot and resolve any issues successfully, then we may no longer be able to support certain digital assets, our digital assets or those of our investment products, including the digital assets and investment products that would be part of our Principal Investments, may be frozen or lost and our systems and technical infrastructure may be affected, all of which could adversely impact the success of our business, financial condition and results of operations. Digital assets are created, issued, transmitted and stored according to protocols run by computers in digital asset networks. It is possible these protocols have undiscovered flaws or could be subject to network scale attacks, which could result in losses to us. Advancements in quantum computing could impact the cryptographic rules of protocols that support certain of our digital assets, which could adversely affect our results of operations.

If the digital asset reward or transaction fees for recording transactions on a digital asset network are not sufficiently high to incentivize miners or validators, or certain jurisdictions continue to limit mining or validating activities, then miners or validators may cease expanding processing or validating power or demand high transaction fees, which could negatively impact the value of the digital asset.

If the digital asset rewards for mining or validating blocks or the transaction fees for recording transactions on a digital asset network are not sufficiently high to incentivize miners or validators, or certain jurisdictions continue to limit mining or validating activities, then miners or validators may cease expending processing or validating power to mine or validate blocks and confirmations of transactions on the digital asset’s blockchain could be slowed. The realization of one or more of the following risks, among others, could materially adversely affect our results of operations:

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If the profit margins of digital asset mining and validating operations are not sufficiently high, including due to an increase in electricity costs or the reduction in rewards, including block reward halving events, then digital asset miners and validators are more likely to immediately sell tokens earned by mining or validating, resulting in an increase in liquid supply of that digital asset, which would generally tend to reduce that digital asset’s market price.

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A reduction in digital assets staked by validators or the processing power expended by miners on a digital asset network could increase the likelihood of a malicious actor disrupting or obtaining control of the network. For more information, see “—If a malicious actor or botnet obtains control of more than 50% of the processing or validating power on a digital asset network, or otherwise obtains control over a digital asset network through its influence over core developers or otherwise, then such actor or botnet could manipulate the blockchain of such digital asset.”

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Miners and validators have historically accepted relatively low transaction confirmation fees on most digital asset networks due to income skewed toward the block reward. If miners or validators demand higher transaction fees for recording transactions in the blockchain or a software upgrade automatically charges fees for all transactions on a digital asset network, then the cost of using such digital asset may increase and the marketplace may be reluctant to accept such digital asset as a means of payment. Alternatively, miners and validators could collude in an anti-competitive manner to reject low transaction fees on a digital asset network and force users to pay higher fees, thus reducing the attractiveness of the digital asset network. Higher transaction confirmation fees resulting from collusion or other factors may reduce the attractiveness of the digital asset network, the value of the digital asset and materially adversely affect the value of our digital assets or those of our investment products, including the digital assets and investment products that would be part of our Principal Investments.

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To the extent that any miners or validators cease to record transactions that do not include the payment of a transaction fee in mined or validated blocks or do not record a transaction because the transaction fee is too low, such transactions will not be recorded on the blockchain of a digital asset until a block is mined or validated by a miner or validator who does not require the payment of transaction fees or is willing to accept a lower fee. Any widespread delays in the recording of transactions could result in a loss of confidence in a digital asset network.

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Miners and validators may be able to prioritize certain transactions in return for increased transaction fees, an incentive system known as Maximal Extractable Value (“MEV”), which may lead to an increase in transaction fees on a digital asset

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network, thereby diminishing its use. For more information on the risks related to MEV, see “—If a malicious actor or botnet obtains control of more than 50% of the processing or validating power on a digital asset network, or otherwise obtains control over a digital asset network through its influence over core developers or otherwise, then such actor or botnet could manipulate the blockchain of such digital asset.”

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Digital asset mining operations can consume significant amounts of electricity, which may have a negative environmental impact and give rise to public opinion against allowing, or government regulations restricting, the use of electricity for mining operations. Additionally, miners may be forced to cease operations during an electricity shortage or power outage.

From time to time, there may be technical issues in connection with changes or upgrades to underlying digital asset networks or protocols of digital assets for which we offer investment products, including the digital assets and investment products that would be part of our Principal Investments, and more broadly, such changes or upgrades may be delayed or unsuccessful, any of which could materially adversely affect our business, financial condition and results of operations.

Rising adoption of digital asset networks leads to network congestion, as space on decentralized ledgers is inherently scarce. From a design standpoint, striking a balance between security, decentralization and scalability (or transactional throughput) is a subject of great debate among innovators and has led to the creation of a variety of networks that make different trade-offs to achieve different outcomes. If network congestion rises to the point where transaction fees make it prohibitively expensive for average users to operate on the network, then those users may stop using the network, and application developers may seek to build on other networks where users can afford to transact.

Any number of anticipated or unforeseen technical changes or software upgrades, soft or hard forks, cybersecurity incidents or other changes to the underlying digital asset network or protocols of digital assets for which we offer investment products, including the digital assets and investment products that would be part of our Principal Investments, may cause incompatibility, technical issues, disruptions or security weaknesses. If the parties responsible for maintaining such networks or protocols are unable to identify, troubleshoot and resolve any such issues successfully, then we may no longer be able to support certain digital assets, or the digital assets custodied by a Custodian on behalf of our investment products, including the digital assets and investment products that would be part of our Principal Investments, may be frozen or lost, all of which could adversely affect the success of our business, financial condition and results of operations.

Changes in the governance of a digital asset network may not receive sufficient support from users and miners or validators, which may negatively affect that digital asset network’s ability to grow and respond to challenges.

The governance of decentralized networks, such as the Bitcoin and Ethereum networks, is by voluntary consensus and open competition. As a result, there may be a lack of consensus or clarity on the governance of any particular decentralized digital asset network, which may stymie such network’s utility and ability to grow and face challenges. The foregoing notwithstanding, the protocols for some decentralized networks, such as the Bitcoin and Ethereum networks, are informally managed by a group of core developers that propose amendments to the relevant network’s source code. Core developers’ roles evolve over time, largely based on self-determined participation. If a significant majority of users and miners or validators adopt amendments to a decentralized network based on the proposals of such core developers, then such network will be subject to new protocols that may adversely affect the value of the relevant digital asset.

As a result of the foregoing, it may be difficult to find solutions or marshal sufficient effort to overcome any future problems, especially long-term problems, on digital asset networks, which could negatively affect our results of operations.

Digital asset networks are developed by a diverse set of contributors, and the perception that certain high-profile contributors will no longer contribute to the network could have an adverse effect on the market price of the related digital asset.

Digital asset networks and related protocols are often developed by a diverse set of contributors, but are also often developed by identifiable and high-profile contributors. The perception that certain high-profile contributors may no longer contribute to the applicable digital asset network or protocol may have an adverse effect on the market price of any related digital assets. For example, in June 2017, an unfounded rumor circulated that Ethereum protocol developer Vitalik Buterin had died. Following the rumor, the price of Ether decreased approximately 20% before recovering after Buterin himself dispelled the rumor. Some have speculated that the rumor led to the decrease in the price of Ether.

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In the event a high-profile contributor to the Bitcoin, Ethereum or other network, or closely associated supporting infrastructure and applications, is perceived as no longer contributing to such networks due to death, retirement, withdrawal, incapacity or otherwise, whether or not such perception is valid, it could adversely affect the prices of digital assets and our results of operations.

A fork or airdrop could materially adversely affect our results of operations.

Many public digital asset networks operate using open-source protocols, meaning that any user can download the software, modify it and then propose that the users and miners or validators of such network adopt the modification. The development team for a network might propose and implement amendments to a network’s source code through software upgrades altering the original protocol, including fundamental ideas such as the irreversibility of transactions and limitations on the validation of blockchain software distributed ledgers. Such changes to original protocols and software could materially adversely affect our results of operations.

When a modification is introduced and a substantial majority of users and miners or validators consent to the modification, the change is implemented and the network remains uninterrupted. However, if less than a substantial majority of users and miners or validators consent to the proposed modification, and the modification is not compatible with the software prior to its modification, then the consequence would be a hard fork of the network, with one group running the pre-modified software and the other running the modified software. The effect of such a fork would be the existence of two versions of the network running in parallel, yet lacking interchangeability. For example, Bitcoin Cash is the result of a hard fork of Bitcoin. Some users of the Bitcoin network may harbor ill will toward the Bitcoin Cash network, and vice versa. These users may attempt to negatively impact the use or adoption of the Bitcoin Cash or Bitcoin network. A fork may also occur as a result of an unintentional or unanticipated software flaw in the various versions of otherwise compatible software that users run. Such a fork could lead to users and miners abandoning the digital asset with the flawed software. It is possible, however, that a substantial number of users and miners could adopt an incompatible version of the digital asset while resisting community-led efforts to merge the two chains. This could result in a permanent fork.

Forks may also occur as a network community’s response to a significant cybersecurity breach. For example, in July 2016, Ethereum “forked” into Ethereum and a new network, Ethereum Classic, as a result of the Ethereum network community’s response to a significant cybersecurity breach. In June 2016, an anonymous hacker exploited a smart contract running on the Ethereum network to syphon approximately $60 million of Ether held by The DAO, a distributed autonomous organization, into a segregated account. In response to the exploit, most participants in the Ethereum community elected to adopt a “fork” that effectively reversed the exploit. However, a minority of users continued to develop the original blockchain, referred to as “Ethereum Classic,” with the digital asset on that blockchain now referred to as ETC. ETC now trades on several digital asset trading platforms.

In addition, many developers have previously initiated hard forks in the Bitcoin blockchain to launch new digital assets, such as Bitcoin Cash (as mentioned above), Bitcoin Gold, Bitcoin Silver and Bitcoin Diamond. To the extent such digital assets compete with a digital asset for which we offer an investment product, such competition could impact demand for such digital asset and adversely impact our results of operations.

Furthermore, a hard fork can lead to new cybersecurity concerns. For example, when the Ethereum and Ethereum Classic networks split in July 2016, replay attacks, in which transactions from one network were rebroadcast to nefarious effect on the other network, plagued Ethereum trading platforms through at least October 2016. An Ethereum Classic trading platform announced in July 2016 that it had lost 40,000 ETC, worth about $100,000 at the time, as a result of replay attacks. Similar replay attack concerns occurred in connection with the Bitcoin Cash hard fork that created the Bitcoin Satoshi Vision network in November 2018. Another possible result of a hard fork is an inherent decrease in the level of security due to significant amounts of processing or validating power remaining on one network or migrating instead to the new forked network. After a hard fork, it may become easier for the hashing power of an individual miner, validator or mining or validating pool to exceed 50% of the processing or validating power of the digital asset network that retained or attracted less processing or validating power, thereby making digital assets that rely on proof-of-work or proof-of-stake more susceptible to attack.

Digital asset networks and related protocols may also be cloned. Unlike a fork of a digital asset network, which modifies an existing blockchain and results in two competing digital asset networks, each with the same genesis block, a “clone” is a copy of a protocol’s codebase but results in an entirely new blockchain and new genesis block. Tokens are created solely from the new clone network and, in contrast to forks, holders of tokens of the existing network that was cloned do not receive any tokens of the new network. A clone results in a competing network that has characteristics substantially similar to the network it was based on, subject to any changes as determined by the developer(s) that initiated the clone.

A hard fork or a clone may adversely affect the price of the digital asset at the time of announcement or adoption. For example, the announcement of a hard fork or a clone could lead to increased demand for the pre-fork or pre-clone digital asset, in anticipation that ownership of the pre-fork or pre-clone digital asset would entitle holders to a new digital asset following the fork or clone. The increased demand for the pre-fork or pre-clone digital asset may cause the price of the digital asset to rise. After the hard fork or clone it is possible

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the aggregate price of the two versions of the digital asset running in parallel would be less than the price of the digital asset immediately prior to the fork or clone. Any future hard fork or clone could adversely affect our business and results of operations.

Moreover, certain digital asset networks have recently implemented, and continue to implement, software upgrades and other changes to their protocols. For example, in September 2022, the Ethereum network activated the long-awaited “Merge” upgrade. The Merge effectively swapped Ethereum’s consensus mechanism away from proof-of-work to proof-of-stake. A digital asset network’s consensus mechanism is a material aspect of its source code, and any failure to properly implement such a change could have a material adverse effect on the value of digital assets that rely on the network, including some of the digital assets for which we offer investment products, including the digital assets and investment products that would be part of our Principal Investments, and the market price of our Class A common stock. It is possible that the Merge introduced a not yet discovered error or vulnerability. It is expected that further developments and forks for the Ethereum network are forthcoming. Any future forks could adversely affect our business and results of operations.

In addition to forks, a digital asset may become subject to a similar occurrence known as an airdrop. In an airdrop, the promoters of a new digital asset announce to holders of another digital asset that such holders will be entitled to claim a certain amount of the new digital asset, generally for free, based on the fact that they hold such other digital asset. We refer to the right to receive any benefits arising from a fork, airdrop or similar event as an “Incidental Right” and any such virtual currency acquired through an Incidental Right as “IR Virtual Currency.”

With respect to any fork, airdrop or similar event, we have implemented policies with respect to GBTC, BTC Mini, ETHE and ETH Mini to cause them to irrevocably abandon the Incidental Rights and any IR Virtual Currency associated with such event. In the event we seek to change our policy with respect to GBTC, BTC Mini, ETHE, ETH Mini or any other investment product that has been approved for trading on NYSE Arca, an application would need to be filed with the SEC by NYSE Arca seeking approval to amend its listing rules to permit us to distribute the Incidental Rights or IR Virtual Currency in-kind to an agent of the stockholders of our products for resale by such agent. We have no current intention to change our policy with respect to forks, airdrops and similar events, but if we did make such a change, there would be no guarantee that NYSE Arca would seek or obtain the necessary approval from the SEC for any of our investment products for which such approval would otherwise be required. With respect to our other investment products that are not listed on NYSE Arca, we generally evaluate each fork, airdrop or similar event on a case-by-case basis and may decide to abandon Incidental Rights or any IR Virtual Currency resulting from a hard fork, airdrop or similar event should we conclude that such abandonment is in the best interests of the particular investment product. As such, investors in our products may not receive the benefits of any forks, and we may not choose, or be able, to participate in an airdrop or similar event. As a result, the attractiveness of our investment products could be reduced, and investors may choose not to invest in our investment products or to sell their positions in favor of direct investments in digital assets to receive any benefits arising from a fork, airdrop or similar event, and our results of operations could thereby be adversely affected.

The prices of digital assets generally may be affected by stablecoins (including Tether and USDC), the activities of stablecoin issuers and their regulatory treatment.

While none of our investment products currently hold stablecoins, and the Custodians do not custody any stablecoins for us or our investment products, we may nonetheless be exposed to certain risks that stablecoins pose for the digital asset market. Stablecoins are digital assets designed to have a stable value over time, as compared to typically volatile digital assets, and are typically marketed as being pegged to the value of a referenced asset, normally a fiat currency, such as the U.S. dollar. Although the prices of stablecoins are intended to be stable compared to their referenced asset, in many cases their prices fluctuate, sometimes significantly, and such prices may deviate significantly across various platforms notwithstanding the mechanisms designed to keep such stablecoins stable, such as arbitrage mechanisms, when particular platforms lack liquidity necessary to effect such mechanisms but other platforms are able to provide functioning markets as intended. This volatility has in the past impacted the prices of certain digital assets, and has at times caused certain stablecoins to lose their “peg” to the underlying fiat currency or to trade at significantly different prices across various digital asset trading platforms. Stablecoins are a relatively new phenomenon, and it is impossible to know all of the risks that they could pose to participants in the digital asset markets or to our business.

In addition, some have argued that some stablecoins are or have been improperly issued without sufficient backing in a way that could cause artificial rather than genuine demand for digital assets, raising their prices. Regulators have also charged stablecoin issuers with violations of law or otherwise required certain stablecoin issuers to cease certain operations. For example, on February 17, 2021, the New York Attorney General (“NYAG”) entered into an agreement with Tether’s operators, requiring them to cease any further trading activity with New York persons and pay $18.5 million in penalties for false and misleading statements made regarding the assets backing Tether. On October 15, 2021, the CFTC announced a settlement with Tether’s operators in which they agreed to pay $42.5 million in fines to settle charges regarding, among others, Tether’s claims that it maintained sufficient U.S. dollar reserves to back every Tether stablecoin in circulation with the “equivalent amount of corresponding fiat currency” held by Tether were untrue.

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U.S. Dollar Coin stablecoin (“USDC”) is a reserve-backed stablecoin issued by Circle Internet Financial that is commonly used as a method of payment in digital asset markets. The issuer of USDC holds cash deposits at insured depository institutions and uses the Circle Reserve Fund to hold cash, U.S. Treasury bills, notes and other obligations issued or guaranteed as to principal and interest by the U.S. Treasury, and repurchase agreements secured by such obligations or cash, which serve as reserves backing USDC stablecoins. While USDC is designed to maintain a stable value at 1 U.S. dollar at all times, on March 10, 2023, the value of USDC fell below 1 U.S. dollar (and remained below for multiple days) after Circle Internet Financial disclosed that $3.3 billion of the USDC reserves were held at Silicon Valley Bank, which had entered FDIC receivership earlier that day. Popular stablecoins are reliant on the U.S. banking system and U.S. treasuries, and the failure of either to function normally could impede the function of stablecoins or lead to outsized redemption requests, and therefore could adversely affect the prices of digital assets and our results of operations.

Given the role that stablecoins play in global digital asset markets, their fundamental liquidity can have a dramatic impact on the broader digital asset market. Because a large portion of the digital asset market still depends on stablecoins such as Tether and USDC, there is a risk that a disorderly de-pegging or a run on Tether or USDC could lead to dramatic market volatility in, and/or materially and adversely affect the prices of, digital assets more broadly. Volatility in stablecoins, operational issues with stablecoins (for example, technical issues that prevent settlement), concerns about the sufficiency of any reserves that support stablecoins or regulatory concerns about stablecoin issuers or intermediaries that support stablecoins could impact individuals’ willingness to trade on trading venues that rely on stablecoins and affect the prices of digital assets and our results of operations.

We have an investment product that invests in digital assets associated with DeFi applications and may suffer losses if the DeFi protocols do not function as expected.

We have an investment product, Grayscale Decentralized Finance (DeFi) Fund, that invests in digital assets associated with DeFi applications. DeFi protocols generally operate pursuant to smart contracts, which are self-executing. Some of these DeFi protocols allow users to, for example, transfer digital assets to a pool from which other users can borrow without requiring an intermediate party to facilitate these transactions. Digital assets transferred to a pool generally generate interest that is distributed to the lender based on the rates at which borrowers repay the loan and can generally be withdrawn with no restrictions. However, these DeFi protocols and activities pose heightened regulatory concerns and are subject to various risks, including, but not limited to, the following, any of which could have an adverse effect on our results of operations:

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Digital assets on DeFi platforms may be determined to be securities and DeFi protocols and activities may be determined to be exchanges subject to federal securities laws.

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DeFi protocols, related actors and DeFi activities may be determined to be in violation of the Commodity Exchange Act of 1936 (the “CEA”) and regulations promulgated thereunder.

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Legislative bodies and regulators may otherwise take novel steps to supervise, limit or even prohibit DeFi protocols and activities.

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Traditional financial services intermediaries, the associations that represent them and their legislative allies may actively encourage policymakers and regulatory authorities to take actions that impede the development and use of DeFi protocols and activities.

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Difficulties in verifying the identity of a transaction counterparty could prevent compliance with regulations or controls relating to AML, financing of terrorism or economic sanctions.

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Underlying smart contracts may be subject to technical issues, disruptions or security weaknesses or vulnerabilities, thereby putting funds at risk of theft or loss.

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Malicious actors may exploit the structure of underlying smart contracts or applications by using them in unintended ways, even if such use does not technically constitute exploitation of a security weakness, by, for example, manipulating the prices of certain digital assets that trigger second-order behaviors.

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Core developers with protocol administration rights may make unauthorized or harmful changes to underlying smart contracts.

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Underlying collateral may experience significant market price volatility, resulting in deleveraging that moves market prices dramatically.

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Borrowers may default, resulting in lenders being unable to recover their digital assets.

If any of these risks materialize, then our investment product that invests in digital assets associated with DeFi protocols may be adversely affected.

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The growing prominence of memecoins and their promotion by high-profile figures could materially adversely affect our business and the broader digital asset market.

The growing prominence of memecoins and their promotion by high-profile figures present unique risks that could materially affect our business and the broader digital asset market. Memecoins are often characterized by extreme volatility, speculative trading and limited fundamental value, which may lead to sudden and significant price fluctuations. The lack of transparency and potential for market manipulation associated with memecoins could expose investors to increased financial and reputational risks. In 2025 we launched Grayscale Dogecoin Trust, which holds DOGE, a digital asset that has historically been considered a memecoin. In addition, negative perception associated with one or more memecoins could negatively impact perception of the digital assets more generally, even if we do not offer a product associated with such memecoin. As a result, reputational risks associated with memecoins generally could adversely impact our business.

Additionally, the recent trend of U.S. and non-U.S. politicians launching or associating with memecoins introduces further political and regulatory complexities. For example, controversy around the launch of a digital asset known as LIBRA by political figures in Argentina reflects how memecoins are increasingly being used as political tools, which may heighten regulatory scrutiny and create market instability. The perceived or actual alignment of certain digital assets with political agendas could lead to increased government intervention, public backlash or restrictions on trading and offering such assets. Any resulting regulatory actions or shifts in investor sentiment could negatively impact the value of our digital asset products, our operations and our ability to operate or introduce new offerings.

The establishment of a strategic Bitcoin reserve or digital asset stockpile by the U.S. government could introduce significant market and regulatory risks that may adversely affect our business and the broader digital asset market.

On March 6, 2025, President Trump, through executive order, established a Strategic Bitcoin Reserve and Digital Asset Stockpile. The establishment of a Strategic Bitcoin reserve or digital asset stockpile by the U.S. government could introduce significant market and regulatory risks that may adversely affect our business and the broader digital asset market. If the U.S. government were to accumulate and hold significant amounts of Bitcoin or other digital assets, it could influence market liquidity, pricing and overall market stability. Large-scale government acquisitions or liquidations of digital assets could lead to substantial price volatility and disrupt normal market functioning.

Furthermore, the creation of a government-controlled digital asset reserve may lead to increased regulatory oversight and intervention in the digital asset market. Government ownership of strategic digital assets could prompt new legislation, taxation policies and trading restrictions that could alter the competitive landscape and limit our ability to structure and offer digital asset products. Any perceived or actual government influence over the supply and demand dynamics of key digital assets could negatively affect investor confidence and the value of our investment products and our Principal Investments.

If a malicious actor or botnet obtains control of more than 50% of the processing or validating power on a digital asset network, or otherwise obtains control over a digital asset network through its influence over core developers or otherwise, then such actor or botnet could manipulate the blockchain of such digital asset.

If a malicious actor or botnet obtains a majority of the processing or validating power on a digital asset network, as has happened in the past, then it may be able to manipulate transactions on or otherwise alter the underlying network, which could cause financial losses to holders, damage the network’s reputation and security and adversely affect the network’s value. Such an actor or botnet may also be able to alter the blockchain on which transactions in any digital assets rely by constructing fraudulent blocks or preventing certain transactions from completing in a timely manner, or at all. The malicious actor or botnet could also control, exclude or modify the ordering of transactions. Although the malicious actor or botnet would not be able to generate new tokens or transactions using such control, it may be able to “double-spend” its own digital assets (i.e., spend the same tokens in more than one transaction) and prevent the confirmation of other users’ transactions for so long as it maintained control (over 50%). To the extent that such malicious actor or botnet did not yield its control of the processing or validating power on the relevant digital asset network, or the digital asset community did not reject the fraudulent blocks as malicious, reversing any changes made to the relevant blockchain may not be possible. Further, a malicious actor or botnet could create a flood of transactions in order to slow down the relevant digital asset network.

For example, in August 2020, the Ethereum Classic network, a proof-of-work network, was the target of two double-spend attacks by an unknown actor or actors that gained more than 50% of the processing power of the Ethereum Classic network. The attacks resulted in reorganizations of the Ethereum Classic blockchain that allowed the attacker or attackers to reverse previously recorded transactions in excess of $5.0 million and $1.0 million.

In addition, in May 2019, the Bitcoin Cash network, a proof-of-work network, experienced a >50% attack when two large mining pools reversed a series of transactions to stop an unknown miner from taking advantage of a flaw in a recent Bitcoin Cash protocol upgrade. Although this particular attack was arguably benevolent, certain individuals believe it negatively impacted the Bitcoin Cash network.

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Further, a malicious actor or botnet could create a flood of transactions to slow down the relevant digital asset network. For example, on June 2, 2018, the Horizen network was the target of a double-spend attack by an unknown actor that gained more than 50% of the processing power of the Horizen network. The attack was the result of delayed submission of blocks to the Horizen network. The core developers of Zen subsequently implemented mitigation procedures to significantly increase the difficulty of attacks of this nature by introducing a penalty for delayed block submissions.

The possible crossing of the 50% threshold indicates a greater risk that an individual miner, validator or mining or validating pool could exert authority over the mining or validation of digital asset transactions, and this risk is heightened if over 50% of the processing or validating power on the network falls within the jurisdiction of a single governmental authority and is significantly heightened if over 66% falls within such a jurisdiction. If such events occur on the networks of digital assets for which we offer investment products, including the digital assets and investment products that would be part of our Principal Investments, and the network participants, including any core developers and administrators of mining or validating pools, do not ensure greater decentralization of the processing or validating power of such network, then the feasibility of a malicious actor obtaining control of the processing or validating power on such network will increase.

There are also concerns that blockchain “bloat” could also contribute to the conditions leading to a >50% attack. As the size of a blockchain grows larger, it requires greater amounts of resources to initially synchronize and validate the entire blockchain. If some potential miners are excluded because these costs become prohibitive, a digital asset network’s processing power may become more concentrated in a smaller number of parties, increasing the feasibility of a malicious actor to obtain control of the processing power on the digital asset network.

More generally, the practice of exploiting MEV has become standard and widespread across both proof-of-work- and proof-of-stake-based platforms. MEV exploitation is the practice by which miners or validators take advantage of their role in the selection and ordering of transactions in a block of a particular digital asset network to benefit themselves financially, often at the expense of users. MEV techniques include censoring, frontrunning, “sandwiching,” backrunning or otherwise executing arbitrage strategies against transactors. While the practice of MEV may seek to enhance market efficiency, MEV can also reduce the effectiveness of certain blockchain transactions and in turn increase the cost of transacting on networks, which may discourage users from transacting on such networks altogether. There are currently no means to completely mitigate the effects of MEV, and thus, to the extent that we transact on these blockchains, whether for proprietary purposes or on behalf of investors in our investment products, we may be unable to protect ourselves or them from the effects or impacts of MEV, which could include a reduction in the speed, quality or security of trades. Furthermore, if any one digital asset network’s user experience is harmed at scale, then the value of the digital assets carried on that network could decline. The occurrence of any of the aforementioned risks associated with MEV could adversely affect the value of digital assets.

A malicious actor may also obtain control over a digital asset network through its influence over core developers by gaining direct control over a core developer or an otherwise influential programmer. To the extent that the digital asset network does not grow, the possibility that a malicious actor may be able to obtain control of the processing or validating power on the network in this manner will remain heightened.

Any of the above events, as well as others, could materially adversely affect the prices of digital assets and our results of operations.

Competing industries may have more influence with policymakers than the digital asset industry, which could lead to the adoption of laws and regulations that are harmful to the digital asset industry and our business.

Although its influence over public policy is increasing, the digital asset industry is relatively new and may not have the same access to policymakers and lobbying organizations in many jurisdictions compared to industries with which digital assets may be seen to compete, such as banking, payments and consumer finance. Competitors from other, more established industries may have greater access to and influence with governmental officials and regulators and may be successful in persuading these policymakers that digital assets require heightened levels of regulation compared to the regulation of traditional financial services. As a result, new laws and regulations may be proposed and adopted in the United States and elsewhere, or existing laws and regulations may be interpreted in new ways, that disfavor or impose compliance burdens on the digital asset industry, which could adversely impact the prices of digital assets and our results of operations.

As digital assets have grown in both popularity and market size, various U.S. federal, state, local and foreign governmental organizations, consumer agencies and public advocacy groups have been examining the operations of digital asset networks, users and platforms, with a focus on how digital assets can be used to launder the proceeds of illegal activities, circumvent economic sanctions-related restrictions and fund criminal or terrorist enterprises, as well as the safety and soundness of platforms and other service providers that hold digital assets for users. Many of these entities have called for heightened regulatory oversight and have issued consumer advisories describing the risks posed by digital assets to users and investors.

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For instance, on September 16, 2022, the U.S. Treasury and Justice Departments released regulatory and legislative recommendations and priorities to address illicit finance risks connected to the digital asset investment ecosystem, following President Biden’s executive order on the regulation of digital assets. The reports reflect the proactive posture that both the U.S. Treasury and Justice Departments have taken toward the enforcement and implementation of AML standards in the digital asset investment ecosystem. The U.K. regulatory framework for crypto assets continues to evolve rapidly, and firms operating in this space face an increasingly complex and restrictive compliance landscape. For example, as part of its AML efforts, the FCA requires crypto asset businesses to be duly registered under the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (as amended). The FCA has also introduced rules to address harm to retail customers arising from the sale of derivatives and exchange-traded notes that reference certain types of crypto assets, contending that they are “ill-suited” to retail consumers due to extreme volatility, valuation challenges and association with financial crimes. The rules, which entered into force on January 6, 2021, prohibit the sale, marketing and distribution to retail clients in the U.K. of derivatives and exchange traded notes that reference certain types of unregulated, transferable crypto assets. The prohibition applies to investment firms, credit institutions and branches in the U.K. of third-country firms that market (among others), distribute or sell digital asset-derivatives or digital asset trading platform traded notes in, or from, the U.K. to retail clients. Many types of crypto assets, including popular cryptocurrencies such as Bitcoin, are also subject to the U.K.’s financial promotions regime. It is a criminal offense for these products to be marketed in the U.K. unless the relevant financial promotion has been approved by an FCA authorized firm or an exemption applies. The exemptions are narrow and will generally only be available to sophisticated investors. In addition, following the Financial Services and Markets Act 2023, the U.K. government and regulators are implementing a new regulatory framework for crypto assets. In April 2025, HM Treasury published draft legislation to bring a wide range of crypto asset activities within the scope of the U.K.’s regulatory perimeter, including operating a crypto asset trading venue, providing custody services, and dealing in crypto assets. The FCA is also consulting on various elements of its forthcoming crypto asset regime. The final rules are expected to come into force in phases from late 2025 into 2026.

Any of the above events, as well as others, could adversely affect the prices of digital assets and our results of operations.

If digital asset networks are used to facilitate illicit activities, then businesses that facilitate transactions in digital assets could be at increased risk of criminal enforcement or civil lawsuits, or of having their services cut off, which could negatively affect the prices of digital assets and our results of operations.

Digital asset networks have in the past been, and may continue to be, used to facilitate illicit activities. If digital asset networks are used to facilitate illicit activities or there are concerns that certain smart contracts could be used to contribute to money laundering or economic sanctions violations, then businesses that facilitate transactions in digital assets could be at increased risk of potential criminal enforcement or civil lawsuits, or of having banking or other services cut off. There is also a risk that certain digital assets could be removed from digital asset trading platforms as a result of these concerns. Other service providers of such businesses may also cut off services if there is a concern that digital assets are being used to facilitate crime. Any of the aforementioned occurrences could increase regulatory scrutiny of the digital asset industry and adversely affect the prices of digital assets and our results of operations.

When we buy, sell or deliver a digital asset, we generally do not transact directly with counterparties other than eligible financial institutions that are subject to federal and state licensing requirements (including entities that are subject to AML and countering the financing of terrorism obligations under the BSA and subject to FinCEN regulation) and that maintain policies, procedures and controls designed to comply with applicable AML and “Know Your Customer” regulations. When such financial institution sources a digital asset in connection with the creation of our investment product’s shares or facilitates transactions in digital assets at our direction, it directly faces another counterparty.

If, despite their and/or our policies, procedures and controls, we or these financial institutions were to transact, directly or indirectly, with a party involved in illicit activity or with a sanctioned person or territory, we and these financial institutions would be at increased risk of potential criminal or civil liability, which could adversely affect our results of operations.

We currently offer investment products associated with certain smart contract-based digital assets. If the underlying smart contracts for these digital assets do not operate as expected, then they could lose value and our business could be adversely affected.

Certain of our investment products, including the investment products that would be part of our Principal Investments, hold digital assets on networks or protocols that support smart contracts, such as ETHE, or rely on smart contracts, such as the Grayscale Decentralized Finance (DeFi) Fund. Smart contracts are software programs that store and transfer value and execute automatically when certain conditions are met. Because smart contracts typically cannot be stopped from self-executing or reversed after self-executing, vulnerabilities in their programming and design can have damaging, and even permanent, ramifications. For instance, in April 2018, a batch overflow bug was found in many Ethereum-based ERC20-compatible smart contract tokens that allowed hackers to create a large number of smart contract tokens, causing multiple digital asset trading platforms worldwide to shut down ERC20-compatible token trading. Similarly, in March 2020, a design flaw in the MakerDAO smart contract caused forced liquidations of digital assets at significantly discounted prices, resulting in millions of dollars of losses to users who had deposited digital assets into the smart contract.

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If any such vulnerabilities or flaws come to fruition, then smart contract-based digital assets may suffer negative publicity, be exposed to security vulnerabilities, decline significantly in value and lose liquidity over a short period of time. As smart contract-based digital assets continue to develop and evolve, we may be subject to unintended or unforeseen regulatory risks and regulatory actions, which may be inconsistently applied across jurisdictions.

In some cases, smart contracts can be controlled by one or more “admin keys” that allow a small group of holders to have significant unilateral control and influence over key decisions related to their underlying networks (“super users”). These super users may have the ability to unilaterally make changes to the smart contract, enable or disable features on the smart contract, change how the smart contract receives external inputs and data and make other changes to the smart contract. For smart contracts that hold a pool of assets, these super users may also be able to extract funds from the pool, liquidate assets held in the pool or take other actions that decrease the value of the assets held by the smart contract in reserves. Even for digital assets that have adopted a decentralized governance mechanism, such as smart contracts that are governed by the holders of a governance token, such governance tokens can be concentrated in the hands of a small group of core community members, who would be able to make similar changes unilaterally to the smart contract. If any such super user or group of core members unilaterally make adverse changes to a smart contract, then the design, functionality, features and value of the smart contract and its related digital assets may be harmed. In addition, assets held by the smart contract in reserves may be stolen, misused, burnt, locked up or otherwise become unusable and irrecoverable.

These super users can also become targets of hackers and malicious attackers. If an attacker is able to access or obtain the super user privileges of a smart contract, or a smart contract’s super users or core community members take actions that adversely affect the smart contract, then we and investors in our investment products who hold and transact in the affected digital assets may experience decreased functionality and value of the applicable digital assets, up to and including a total loss of the value of such digital assets. Although we do not control these smart contracts, any such events could cause us or investors in our investment products to seek damages against us for their losses, result in reputational damage to us or adversely affect our business in other ways.

Private keys are often required to access or transfer digital assets held in custody and the loss or misappropriation of such private keys may cause complete loss of the ability to retrieve or transfer such digital assets. If our Custodians are unable to access the private keys and any backups thereto, or it experiences a cybersecurity breach, hack or other data loss that would restrict its ability to access any digital asset held in custody, then we could become subject to reputational harm, legal claims, regulatory scrutiny and other losses.

Digital assets are typically controlled by the holder of the unique private key for the wallet in which the digital assets are held. While public addresses are generally published when used in a transaction on a blockchain, private keys are required to access, retrieve or transfer the digital assets in the wallet. Therefore, protection and safekeeping of private keys are necessary to prevent unauthorized third-party access to or control over the digital assets held in a wallet. If any of the private keys for our wallets are stolen, misappropriated, lost or otherwise compromised or unavailable, and the backup versions of these private keys are not available at the time or have been otherwise stolen or compromised, then our Custodians will not be able to access the digital assets held in the omnibus wallets.

Digital assets, including wallets and other blockchain technologies, can be hacked or otherwise subject to security breaches and other malicious activities, which may result in, among other things, malicious actors obtaining the ability to retrieve, transfer and otherwise misappropriate the digital assets custodied by a Custodian on behalf of our investment products. Misappropriation, loss or theft of private keys for, or hack or other compromise or unavailability of, wallets holding digital assets custodied by a Custodian on behalf of our investment products could adversely affect the ability of investors in digital assets to retrieve, access or transfer the digital asset and could subject us to significant liabilities and financial losses in addition to losing the trust of investors in digital assets and other market participants. For these reasons, any misappropriation, loss or theft of private keys due to a cybersecurity breach, hack, misconduct or error, or any other compromise of the security and confidentiality of the private keys for the wallets holding digital assets could harm our brand and reputation, could result in significant legal liability or other financial losses and could adversely affect our business.

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The SEC and its staff, at least under the prior administration, took the position that a range of digital assets, products and services fall within the definition of a “security” under the U.S. federal securities laws. Whether or not an asset, product or service is a security or constitutes a securities offering under federal securities laws is ultimately determined by a federal court. Any enforcement action or investigation by the SEC or a state securities regulator, or a court decision or SEC announcement, implying, asserting or finding that a particular digital asset is a security for purposes of the federal or state securities laws would be expected to have an immediate and material adverse impact on the value of that digital asset if it is then generally used or traded in the United States. Depending on the specific characteristics of the digital asset, this could have adverse spillover effects on the value of other digital assets perceived to share similar characteristics. This is because the market structure underpinning most digital assets is incompatible with existing U.S. regulations applicable to securities. If a digital asset is found to be a security, then it is likely to become difficult or impossible for the digital asset to be legally traded, cleared or custodied in the United States through the same channels used by non-security digital assets, which, in addition to materially adversely affecting the value of that digital asset, is likely to significantly impact its liquidity and market participants’ ability to convert the digital asset into U.S. dollars. For example, all transactions in such digital asset would have to be registered with the SEC and potentially state securities regulators, or conducted in accordance with exemptions from registration, which could severely limit its liquidity and usefulness. Moreover, the network on which such digital asset is utilized may be subject to regulation as a securities intermediary, which could effectively render the network impracticable for its existing purposes. To the extent that digital assets held by investment products that we sponsor are implied, asserted or found to be a security, or are impacted by adverse spillover effects from an implication, assertion or finding with respect to another digital asset that is perceived to share similar characteristics, there would likely be an immediate negative impact on the share price of that investment product, and we may be required to dissolve such investment product and liquidate its assets.

Whether a digital asset is a security or offers and sales of a digital asset are securities transactions under the federal securities laws depends on whether it is included in the lists of instruments making up the definition of “security” in the Securities Act, the Exchange Act, the Investment Advisers Act and the Investment Company Act of 1940, as amended (the “Investment Company Act”). Digital assets as such do not appear in any of these lists, although each list includes the terms “investment contract” and “note,” and the SEC has typically analyzed whether a particular digital asset is a security or the offer and sale of a digital asset is a securities transaction by reference to whether it meets the tests developed by the federal courts interpreting these terms, known as the Howey and Reves tests, respectively. For many digital assets, whether or not the Howey or Reves tests are met is difficult to resolve definitively, and substantial legal arguments can often be made both in favor of and against a particular digital asset qualifying as a security or a particular offer and sale of a digital asset qualifying as a securities transaction under one or both of the Howey and Reves tests. Adding to the complexity, the SEC staff has indicated that the security status of a particular digital asset can change over time as the relevant facts evolve.

Certain state regulators or attorneys general have also alleged that certain digital assets are securities under relevant state laws and that digital asset trading platforms’ activities violate state securities laws.

Additional public, though nonbinding, statements by senior officials at the SEC have indicated that the SEC does not consider Bitcoin or Ether and, in certain circumstances, memecoins or some stablecoins, to be securities. In addition, the SEC, by approving the exchange rule filings to list shares of trusts holding Bitcoin and Ether as commodity-based ETPs, appears to have implicitly taken the view that each of Bitcoin and Ether is not a security. Moreover, the SEC has not objected to the trading of futures on various additional digital assets on CFTC-regulated markets under rules designed for futures on non-security commodity underliers. The SEC staff has also provided informal assurances via no-action letters to a handful of promoters that their digital assets are not securities. On the other hand, the SEC under the prior administration brought enforcement actions against the issuers and promoters of several other digital assets on the basis that the digital assets in question are securities, as well as against digital asset trading platforms for operating unregistered securities exchanges on the basis that certain of the digital assets traded on their platforms are securities. In January 2025, the SEC launched a crypto task force dedicated to developing a comprehensive and clear regulatory framework for digital assets led by Commissioner Hester Peirce. Subsequently, Commissioner Peirce announced a list of specific priorities to further that initiative, which included pursuing final rules related to a digital asset’s security status, a revised path to registered offerings and listings for digital assets-based investment vehicles and clarity regarding digital asset custody, lending and staking. Additionally, on July 31, 2025, Chairman Atkins announced “Project Crypto,” a Commission-wide initiative to modernize securities rules for digital assets, reshore innovation in the United States, and implement the recommendations of the report by the interagency working group tasked with “proposing a Federal regulatory framework governing the issuance and operation of digital assets.”

The SEC’s positions on the federal securities law status of particular digital assets are closely watched and can have dramatic effects, whether or not the SEC’s positions prevail in federal court. For example:

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In December 2020, the SEC filed a complaint against the issuer of XRP, Ripple Labs, Inc., and two of its executives, alleging that they raised more than $1.3 billion through XRP sales that should have been registered under the federal securities laws.

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Subsequently, in July 2023, the District Court for the Southern District of New York held that while XRP is not a “security,” certain sales of XRP to certain buyers (but not other types of sales to other buyers) amounted to “investment contracts” under the Howey test. The District Court entered a final judgment in the case on August 7, 2024, and the parties each dismissed their appeals to the Second Circuit on August 7, 2025.

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In June 2023, the SEC filed complaints against Coinbase and Binance alleging, among other things, that such firms were operating as unregistered securities exchanges, brokerages and clearing agencies. In its complaints, the SEC asserted that SOL, ADA, MATIC, FIL, ATOM, SAND, MANA, ALGO, AXS, COTI, CHZ, FLOW, ICP, NEAR, VGX, DASH and NEXO are securities under the federal securities laws. The SEC and Coinbase jointly dismissed the SEC’s lawsuit in February 2025 with prejudice, and the SEC and Binance jointly dismissed the SEC’s lawsuit in May 2025 with prejudice.

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In November 2023, the SEC filed a complaint against Kraken, alleging that it operated as an unregistered securities exchange, brokerage and clearing agency. In its complaint, the SEC asserted that ADA, ALGO, ATOM, FIL, FLOW, ICP, MANA, MATIC, NEAR, OMG and SOL are securities under the federal securities laws. In March 2025, Kraken and the SEC jointly dismissed the SEC’s lawsuit with prejudice.

In the days following the announcement of SEC enforcement actions against certain digital asset issuers and trading platforms, the price of various digital assets have declined significantly and may continue to decline as such cases advance through the federal court system. While several other digital assets market participants have also announced that the SEC informed them that the SEC was terminating its investigation or enforcement action into their firm, the final outcome of many of these enforcement and judicial proceedings (to the extent not yet dismissed), their effect on the broader digital asset investment ecosystem and the reputational impact on industry participants, remain uncertain. The SEC’s actions, as well as seemingly inconsistent views of different courts underscore the continuing uncertainty around which digital assets, or transactions in digital assets, are securities and what the correct analysis is to determine each digital asset’s status. For example, the conflicting district court opinions and analyses demonstrate that factors such as how long a digital asset has been in existence, how widely held it is, how large its market capitalization is, the manner in which it is offered, sold or promoted, and whether it has actual use in commercial transactions, ultimately may have limited to no bearing on whether the SEC, a state securities regulator or any particular court will find it to be a security.

As described under “—A determination that a digital asset is a ‘security’ for purposes of the federal securities laws could have adverse regulatory consequences for us and our investment products with respect to the Investment Company Act and the Investment Advisers Act, and therefore adversely affect our business, financial condition and results of operations, as well as the market price of our Class A common stock,” the determination that a digital asset is a security under the federal securities laws could also have adverse regulatory consequences for us and our investment products with respect to the Investment Company Act and Investment Advisers Act.

To the extent any digital asset for which we offer an investment product is impacted by an implication, assertion or finding that the digital asset is a security, our business, financial condition and results of operations would be adversely affected. For example, in response to the SEC’s action against the issuer of the digital asset XRP, certain significant market participants announced that they would no longer support XRP and announced measures, including the delisting of XRP from major digital asset trading platforms, resulting in our conclusion that it was likely to be increasingly difficult for U.S. investors, including in Grayscale XRP Trust (XRP), to convert XRP into U.S. dollars. We subsequently dissolved Grayscale XRP Trust (XRP) and liquidated its assets. In addition, a final determination by the SEC, a state securities regulator or a court that one or more of the digital assets for which we offer investment products are securities may adversely affect the value of such digital assets and result in potentially extraordinary, nonrecurring expenses to, or termination of, one or more of our affected investment products.

Because the fees on our investment products are generally settled in the underlying digital assets, a decline in the price of that digital asset would reduce the dollar value of the fees we earn from that investment product. Further, declines in the prices of digital assets would likely trigger net outflows from our investment products for which we operate a redemption program, further reducing our fees. Depending on which digital asset is affected, these adverse effects could be material to us and to the market price of our Class A common stock.

A determination that a digital asset is a “security” for purposes of the federal securities laws could have adverse regulatory consequences for us and our investment products with respect to the Investment Company Act and the Investment Advisers Act, and therefore adversely affect our business, financial condition and results of operations, as well as the market price of our Class A common stock.

In addition to the potential for adverse effects to our business, financial condition and results of operations described under “—A determination that a digital asset is a ‘security’ could adversely affect the value of that digital asset and potentially digital assets generally, and therefore adversely affect our business, financial condition and results of operations, as well as the market price of our Class A common stock,” a determination that a digital asset is a security under the federal securities laws has implications for the regulatory obligations that apply pursuant to the Investment Company Act and/or the Investment Advisers Act.

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The Investment Company Act is intended to protect investors (for example, by preventing insiders from managing investment companies to their benefit and to the detriment of public investors), and it requires an issuer primarily engaged in the business of investing, reinvesting or trading in securities to register as an investment company, unless a valid exemption applies. If one or more digital assets underlying our investment products is determined to be a security, then such investment product may be required to register as an investment company under the Investment Company Act.

If we determine that any of our investment products is likely to be required to register as an investment company under the Investment Company Act, then we may direct the restructuring of such investment product, disposing of digital assets that are determined to be securities and/or acquiring digital assets that are not determined to be securities. These dispositions or acquisitions could be required to take place under unfavorable market conditions and may result in the incurrence of losses by such investment products. Alternatively, we may seek to register such investment product as an investment company under the Investment Company Act. Such additional registration would result in extraordinary, recurring or nonrecurring expenses. It may also be difficult or impossible to operate an investment product investing in digital assets in accordance with the requirements applicable to investment companies registered under the Investment Company Act. For example, among other requirements, the Investment Company Act requires the assets of a registered investment company to be maintained with a custodian that meets the requirements of the Investment Company Act, limits the extent to which certain registered investment companies can hold illiquid assets, imposes requirements on the valuation of the assets of registered investment companies and restricts the ability of registered investment companies to transact with affiliated persons. There is no guarantee that we would be able to take actions to bring our investment products into compliance with the Investment Company Act, in which case we may be forced to dissolve such investment products and liquidate their assets. Further, we and our investment products could be deemed to have participated in illegal offerings of securities in violation of the Investment Company Act, thereby incurring SEC monetary fines and other penalties, including restrictions on the ability to conduct business. In addition, counterparties to contracts to which our investment products are party could seek to avoid their obligations on grounds that contracts with illegally unregistered investment companies are unenforceable.

Even if we are able to register an investment product as an investment company under the Investment Company Act or otherwise restructure an investment product to become compliant with the Investment Company Act, any steps we are able to take to ensure future compliance with the Investment Company Act would not insulate us or our investment products from liability for past violations. Any of these events could adversely affect our business, financial condition and results of operations, as well as the market price of our Class A common stock.

If any of our investment products becomes subject to the Investment Company Act, then we may become subject to registration and regulation as an investment adviser under the Investment Advisers Act, unless a valid exemption applies. If a digital asset is determined to be a security, and we administered an investment product for such digital asset in a manner implicating Investment Advisers Act registration requirements without being so registered or without a valid exemption, then we could incur SEC monetary fines and other penalties, including restrictions on our ability to conduct business.

Moreover, the Investment Advisers Act mandates that if a registered adviser has custody of client funds and securities, it must maintain them with a “qualified custodian” as defined in Rule 206(4)-2(d)(6). Given the characteristics of digital assets and the relative novelty of this asset class, there is a limited number of qualified custodians available at this time, and there can be no assurance that we will be successful in maintaining our digital assets or those of our investment products with the Custodians, or another qualified custodian. There can be no assurance that a Custodian would continue to qualify as a qualified custodian under the final rule. Difficulties in maintaining a qualified custodian could potentially cause us to dissolve an investment product and liquidate its assets.

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We utilize a process designed to analyze whether any of the digital assets for which we offer investment products could be deemed to be a “security” under the federal securities laws, which evolves to take into account developments in case law, regulatory guidance, facts and technology of which we become aware. To the extent any such development implicates the security status of a particular digital asset for which we offer an investment product, we endeavor to reassess our conclusion with respect to such digital asset. We believe that our process reflects a thoughtful analysis that is reasonably designed to enable us to offer investment products for digital assets that are not securities under the federal securities laws. Our process does not include a state-by-state securities laws analysis. Nonetheless, in light of the inherent uncertainties, continually evolving case law and the fact-based nature of our analysis, we cannot guarantee that a federal court having final determinative authority on the topic will agree with our conclusion with respect to any particular digital asset or transaction in a particular digital asset, or that regulatory or legal action will be precluded.

As part of determining whether a particular digital asset is a security, or a transaction in a particular digital asset by us is a securities transaction, for purposes of the federal securities laws, we take into account a number of factors, including the various definitions of “security” under the federal securities laws and federal court decisions interpreting elements of these definitions, such as the U.S. Supreme Court’s decisions in the Howey and Reves cases, and their progeny, as well as reports, orders, press releases, public statements and speeches by the SEC, its commissioners and its staff providing guidance on when a digital asset may be a security or when an offer and sale of a digital asset may be a securities transaction for purposes of the federal securities laws.

Finally, we seek advice with respect to the security status of the digital asset with external counsel and receive a memorandum regarding the status of such digital asset under the federal securities laws. Usually drawing on publicly available information, analyses from external counsel typically involve a review of the often complex facts surrounding a particular digital asset’s underlying technology, creation, use case and usage development, distribution and secondary market trading characteristics, as well as contributions of and marketing or promotional efforts by the individuals or organizations who appear to be involved in these activities, among other relevant facts. This publicly available information, usually found on the internet, often includes information that originated with or is attributed to such individuals or organizations, as well as information from third-party sources and databases that may or may not have a connection to such individuals or organizations. We and our external counsel often have no independent means of verifying the accuracy or completeness of such information and must necessarily assume that it is materially accurate and complete for purposes of the Howey and Reves analyses.

After having gathered this information, external counsel typically analyzes it in light of the Howey and Reves tests to inform our judgment as to whether or not a federal court would conclude that the digital asset, or transactions in the digital asset, in question is or is not a security, or are or are not securities transactions, respectively, for purposes of the federal securities laws. Often, certain factors appear to support a conclusion that the digital asset or certain transactions in the digital asset in question is a security or securities transaction, respectively, while other factors appear to support the opposite conclusion. In such cases, external counsel endeavors to weigh the importance and relevance of the competing factors. This analytical process is further complicated by the fact that, at present, federal judicial case law applying the relevant tests to digital assets is limited, and in some situations, inconsistent, with no federal appellate court having substantively analyzed the question on the merits. In addition, as each digital asset presents its own unique set of relevant facts, it is not always possible to directly analogize the analysis of one digital asset to another. Given the relative novelty of digital assets, the challenges inherent in fact-gathering for particular digital assets and the fact that federal courts have only recently been tasked with adjudicating the applicability of federal securities law to digital assets, at present, external counsel is generally not in a position to render a legal “opinion” on the securities law status of any digital asset.

In light of these uncertainties and the fact-based nature of the analysis, we acknowledge that the SEC, or a federal court having final determinative authority on the topic, may take a contrary position to ours for a particular digital asset. Our conclusion, even if reasonable under the circumstances, would not preclude regulatory or legal action based on the determination that a digital asset underlying one of our investment products is a security, which would have a material adverse effect on our business and results of operations.

If we determine that a particular digital asset, or transactions in a particular digital asset, is a security or are securities transactions, respectively, under the federal securities laws, whether this determination is initially made by us, or because a federal court upholds an allegation that a particular digital asset is a security, then we do not intend to permit our investment products to continue holding that digital asset in a way that would violate the federal securities laws. Upon such determination, we would either dispose of such digital asset, dissolve the investment product and liquidate its assets or potentially seek to manage its affairs in a manner that complies with the federal securities laws, including the Investment Company Act. Because the legal tests for determining whether a digital asset, or transactions in the digital asset, is or is not a security, or are or are not securities transactions, respectively, often leave room for interpretation, for so long as we believe there to be good-faith grounds to conclude that an underlying digital asset is not a security, we do not intend to dispose of a digital asset or dissolve or restructure the investment product or liquidate its assets on the basis that any particular digital asset holding could at some future point be determined to be a security.

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Moreover, due to the complexities in applying the federal securities laws to digital assets, as well as the fact that different companies doing business in the digital asset industry take varying approaches to digital asset analyses, we expect that competitors may from time to time reach different conclusions from us on the security status of a particular digital asset or digital asset category. Although we anticipate that these differences will narrow over time as the federal courts address the security status of larger numbers of digital assets, as the SEC issues new rules or guidance or as Congress enacts relevant legislation, until that occurs, if competitors conclude that they can hold digital assets in ways that we do not permit, then they may have business and revenue opportunities that are not available to us.

Registration and compliance with CFTC regulations and rulemaking could result in potentially extraordinary and nonrecurring expenses and cause us to dissolve an investment product if it is deemed to be a commodity interest pool under the CEA.

CFTC regulations and rulemaking may impact the manner in which digital assets are treated. In particular, a digital asset may be classified by the CFTC as a “commodity interest” under the CEA, which may subject us to regulation under the CEA and CFTC regulations. To the extent our investment products hold assets that are commodity interests, we may be required to register as a commodity pool operator or commodity trading adviser with the CFTC and become a member of the National Futures Association. We may also be subject to additional regulatory requirements with respect to our investment products, including disclosure and reporting requirements. These additional requirements may result in extraordinary, recurring and/or nonrecurring expenses. If we determine not to comply with such additional regulatory and registration requirements, then we would dissolve the investment product and liquidate its assets. Any such dissolution and liquidation would result in a stagnation or decrease in our AUM and revenues.

Compliance with money services business or money transmitter regulations may force us to incur extraordinary and nonrecurring expenses or subject us to enforcement actions.

To the extent that our activities may cause us to be deemed a money services business (“MSB”) under the regulations promulgated by FinCEN, we may be required to register with FinCEN as an MSB and comply with the BSA and its implementing regulations, as applicable to MSBs, including the AML compliance program, recordkeeping, and reporting requirements applicable to MSBs. Similarly, our activities may require us to be licensed as a money transmitter or as a digital asset business, such as under the New York State Department of Financial Services’ BitLicense regulations, Louisiana’s Virtual Currency Businesses Act or California’s Digital Financial Assets Law, once effective. Compliance with such laws and regulations may force us to incur extraordinary recurring and nonrecurring expenses. If we decided to seek any licenses, there is no guarantee that we would timely receive them. We may decide instead to dissolve an investment product and liquidate its assets, which would result in a stagnation or decrease in our AUM and revenues.

Additionally, to the extent we are found to have operated without appropriate state licenses or federal registration and/or to have failed to comply with the BSA, we may be subject to investigation and to administrative, civil or criminal proceedings, which may lead to monetary fines and penalties and/or equitable relief, and we may face loss of banking or other business relationships and reputational harm.

We are required to comply with certain laws related to economic sanctions.

We are required to comply with laws and regulations related to economic sanctions that are administered and enforced by OFAC and/or the U.S. Department of State. U.S. economic sanctions laws and regulations generally restrict dealings with certain governments, countries or territories that are the target of comprehensive sanctions, as well as blocked persons, including persons on the List of Specially Designated Nationals and Blocked Persons, and any person owned, directly or indirectly, individually or in the aggregate, by one or more such person or persons. While we maintain policies, procedures, and controls to promote compliance with U.S. economic sanctions, there can be no guarantee that these measures will prevent all breaches of U.S. economic sanctions requirements. If we were to be found to have potentially violated U.S. economic sanctions, even inadvertently, we may be subject to investigation and to administrative, civil or criminal proceedings, which may lead to monetary fines and penalties, and may face loss of banking or other business relationships and reputational harm. We may also be required to comply with economic sanctions imposed by countries other than the United States, and noncompliance with such requirements could lead to similar negative consequences and substantial impacts on us.

We are subject to extensive government regulations. Our failure or inability to comply with these regulations could materially adversely affect our business, financial condition and results of operations.

As a digital asset-focused investment platform, we are subject to extensive government regulations. We are guided in significant part by regulatory regimes that might apply to digital assets that are not clear or are not yet developed. To the extent that there is any ambiguity as to whether a digital asset held by our investment products or otherwise under our management is a security, the applicability of many regulations to our business will not be clear.

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We regularly rely on exemptions in the United States from various laws, including the Securities Act, in conducting our activities. These exemptions are sometimes highly complex and may, in certain circumstances, depend on compliance by third parties we do not control. If for any reason these exemptions were to become unavailable to us, then we could become subject to additional restrictive and costly registration requirements, regulatory actions or third-party claims, and our business could be materially adversely affected. For example, in offering new investment products, we typically rely on private placement exemptions from registration under the Securities Act, including Rule 506 of Regulation D. However, Rule 506 becomes unavailable to issuers (including our investment products) if the issuer or any of its “covered persons” (certain officers and directors and third parties, including, among others, promoters, placement agents and beneficial owners of 20% of outstanding voting securities of the issuer) has been the subject of a “disqualifying event,” which includes a variety of criminal, regulatory and civil matters (the so-called “bad actor” disqualification). If our investment products or any of the covered persons associated with our investment products is subject to a disqualifying event, then one or more of our investment products could lose the ability to issue shares in a Rule 506 private offering for a significant period of time, which could impair our ability to manage the affairs of our existing investment products and to organize and offer new investment products, and, therefore, materially adversely affect us. In addition, if certain of our employees or any potential investor has been the subject of a disqualifying event, then we could be required to reassign or terminate such employee or to reduce or refuse the investment of such an investor, which could impair our relationships with investors, harm our reputation or make it more difficult to offer investment products.

Further, conflicts of interest may arise among us and our affiliates, including our subsidiaries, on the one hand, and our investment products and their stockholders, on the other hand. We have not established formal procedures to resolve all potential conflicts of interest, and stockholders of our investment products may be dependent on the good faith of the respective parties subject to such conflicts to resolve them equitably. Although we attempt to monitor these conflicts, it is extremely difficult, if not impossible, for us to ensure that these conflicts do not, in fact, result in adverse consequences to our investment products. If we fail, or appear to fail, to deal appropriately with any of these conflicts, then we may face reputational damage, litigation, regulatory proceedings or penalties, fines or sanctions, any of which could materially adversely affect our business, financial condition and results of operations.

We also operate an investment advisory subsidiary, Grayscale Advisors, LLC (“GSA”), and broker-dealer subsidiary, Grayscale Securities, LLC (“GSS”), each of which is subject to additional, specific regulatory schemes. GSA is registered as an investment adviser with the SEC under the Investment Advisers Act and is regulated thereunder, and serves as an advisor to our ETFs and certain Private Funds. Our ETFs are registered under the Investment Company Act and are subject to the Securities Act and the rules and regulations thereunder and GSA’s management of such ETFs and Private Funds is subject to the Investment Advisers Act and the rules and regulations thereunder. The Investment Advisers Act and the Investment Company Act, together with the rules and regulations thereunder and related interpretations of the SEC, impose numerous obligations and restrictions on investment advisers and registered investment companies, including requirements relating to the safekeeping of client funds and securities, limitations on advertising, disclosure and reporting obligations, prohibitions on fraudulent activities, restrictions on certain transactions between an adviser and its clients, and between a registered investment company and its advisers and affiliates, and other detailed operating requirements, as well as general fiduciary obligations. For more information on the risks associated with the Investment Company Act and Investment Advisers Act, see “—A determination that a digital asset is a ‘security’ for purposes of the federal securities laws could have adverse regulatory consequences for us and our investment products with respect to the Investment Company Act and the Investment Advisers Act, and therefore adversely affect our business, financial condition and results of operations, as well as the market price of our Class A common stock.”

GSS is subject to regulatory restrictions and requirements imposed by applicable statutes, regulations and policies in the jurisdictions in which it operates. GSS is registered with the SEC and is a member of FINRA. GSS serves as a placement agent in the creation of shares, as well as the distributor and marketer for a number of our investment products. As a registered broker-dealer, GSS is subject to regulation that covers all aspects of its securities business, including sales and trading methods, trade practices, use and safekeeping of customers’ funds and securities, capital structure and requirements, recordkeeping and the conduct of broker-dealer personnel, including officers and employees. GSS is subject to periodic examinations and investigations by the SEC and FINRA. GSS is also subject to the BSA, as amended, including by the USA PATRIOT Act of 2001, and the implementing regulations thereunder, which require financial institutions, including broker-dealers, to establish AML compliance programs, file suspicious activity and other reports with the U.S. government and maintain certain records. U.S. government agencies and self-regulatory organizations, including state securities commissions, are empowered to enforce these regulatory restrictions and requirements and conduct administrative proceedings that can result in censure, fine, the issuance of cease-and-desist orders or the suspension or expulsion of broker-dealers from registration or membership. Broker-dealers must also implement related customer identification procedures and beneficial ownership identification procedures.

Further, we are also subject to ongoing examinations, oversight and reviews by U.S. federal and state regulators and financial services regulators, all of which have broad discretion to audit and examine our business. We are periodically subject to audits and examinations by these regulatory authorities. As a result of findings from these audits and examinations, regulators have in the past required, are requiring and may in the future require us to take certain actions, including amending, updating or revising our compliance measures from time to time, limiting the kinds of investors which we provide products to, changing, terminating or delaying the introduction of our existing or new investment products, and undertaking further external audit or being subject to further regulatory

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scrutiny. For example, on April 1, 2014, GBTC launched a program pursuant to which its stockholders could request redemptions from Genesis Global Trading, Inc. (“Genesis Global Trading”), a former affiliate of ours. On September 23, 2014, Genesis Global Trading received a letter from the staff of the SEC’s Office of Compliance Inspections and Examinations summarizing the staff’s findings from an onsite review of Genesis Global Trading’s broker-dealer activities conducted in June 2014. In its exit report, the staff stated that it had concluded that GBTC’s redemption program, in which its stockholders were permitted to request the redemption of their shares through Genesis Global Trading, appeared to violate Regulation M under the Exchange Act because such redemptions took place at the same time that GBTC was in the process of creating shares. On July 11, 2016, Genesis Global Trading and GBTC entered into a settlement agreement with the SEC whereby they agreed to a cease-and-desist order against future violations of Rules 101 and 102 of Regulation M under the Exchange Act. Genesis Global Trading also agreed to pay disgorgement of redemption fees, including pre-judgment interest, of approximately $54,000.

We may receive examination reports citing violations of rules and regulations and inadequacies in existing compliance programs, and requiring us to enhance certain practices with respect to our compliance program, including due diligence, monitoring, training, reporting and recordkeeping. Implementing appropriate measures to properly remediate these examination findings may require us to incur significant costs, and if we fail to properly remediate any of these examination findings, then we could face civil litigation, significant fines, damage awards, forced removal of certain employees including members of our executive team, barring of certain employees from participating in our business in whole or in part, revocation of existing licenses, limitations on existing and new investment products, reputational harm, negative impact to our existing relationships with regulators, exposure to criminal liability or other consequences.

Further, should strict legal and regulatory requirements and additional regulatory investigations and enforcement occur or intensify, it may continue to result in changes to our business, as well as increased costs, and supervision and examination for both us and our agents and service providers. New laws, regulations or interpretations may result in additional litigation, regulatory investigations, and enforcement or other actions, including preventing or delaying us from offering certain investment products offered by our competitors, or could impact how we offer such products. Adverse changes to, or our failure to comply with, any laws and regulations have had, and may continue to have, an adverse effect on our reputation and brand and our business, operating results and financial condition. Such additional requirements could cause us to incur extraordinary expenses, possibly materially adversely affecting our business, financial condition and results of operations.

All of the foregoing laws and regulations, as well as any other laws and regulations we are or may become subject to, are complex and we are required to expend significant resources to monitor and maintain our compliance with such laws and regulations. It is also possible that the current or a new Administration and the current or a new Congress in the United States implement new laws and regulations that we may be required to expend significant resources on understanding and complying with. Any failure on our part to comply with these and other applicable laws and regulations could result in regulatory fines, suspensions of personnel or other sanctions, including revocation of our registration or that of our subsidiaries as an investment adviser or broker-dealer, which could, among other things, require changes to our business practices and scope of operations or harm our reputation, which, in turn, could have a material adverse effect on our business, financial condition and results of operations.

In addition, financial services regulation is constantly changing, and new laws or regulations, or new interpretations of existing laws or regulations, could have a materially adverse impact on our ability to operate as currently intended, or require us to obtain additional or newly created registrations or licenses in the future and cause us to incur significant expense in order to ensure compliance. It is not currently clear to what extent federal and state financial services regulators will continue enforcing existing laws, regulations, and rules and will continue to enhance their supervisory expectations regarding the management of legal and regulatory compliance risks. These potential regulatory changes and uncertainties make our business planning more difficult and could result in changes to our business model and potentially adversely impact our results of operations.

Proposals to change the statutes affecting financial services companies are frequently introduced in Congress and state legislatures that, if enacted, may affect their operating environment and the registrations or licenses we require in substantial and unpredictable ways. In addition, numerous federal and state regulators have the authority to promulgate or change regulations that could have a similar effect. We cannot determine with any degree of certainty whether any such legislative or regulatory proposals will be enacted and, if enacted, the ultimate impact that any such potential legislation or implementing regulations, or any such potential regulatory actions by federal or state regulators, would have upon our business.

New laws, regulations, policy or changes in enforcement of existing laws or regulations applicable to our business, or reexamination of current practices, could adversely impact our profitability, limit our ability to continue existing or pursue new business activities, require us to change certain of our business practices or the registrations or licenses we are required to hold or obtain, affect retention of key personnel, or expose us to additional costs (including increased compliance costs and/or customer remediation). These changes also may require us to invest significant resources, and devote significant management attention, to make any necessary changes and could adversely affect our business.

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The nature of our business requires the application of complex financial accounting rules, and there is limited guidance from accounting standard-setting bodies.

The accounting rules and regulations that we must comply with are complex and subject to interpretation by the Financial Accounting Standards Board (the “FASB”), the SEC and various bodies formed to promulgate and interpret appropriate accounting principles. A change in these principles or interpretations could have a significant effect on our reported financial results and may even affect the reporting of transactions completed before the announcement or effectiveness of a change. Recent actions and public comments from the FASB and the SEC have focused on the integrity of financial reporting and internal controls. In addition, many companies’ accounting policies are being subject to heightened scrutiny by regulators and the public. Further, there have been limited precedents for the financial accounting of digital assets and related valuation and revenue recognition. Moreover, a change in these principles or interpretations could have a significant effect on our reported financial results, and may even affect the reporting of transactions completed before the announcement or effectiveness of a change. For example, in December 2023, the FASB issued Accounting Standards Update No. 2023-08, Intangibles—Goodwill and Other—Crypto Assets (ASU 2023-08): Accounting for and Disclosure of Crypto Assets (“ASU 2023-08”), which represents a significant change in how entities that hold digital assets account for certain of those holdings. Previously, digital assets held were accounted for as intangible assets with indefinite useful lives, which required us to measure digital assets at cost less impairment. Effective as of January 1, 2024, we adopted ASU 2023-08, which requires us to measure digital assets held at fair value at each reporting date, with fair value gains and losses recognized through net income/(loss). Fair value gains and losses can increase the volatility of our net income, especially if the underlying digital asset market is volatile. Additionally, on January 21, 2025, the SEC launched a crypto task force dedicated to developing a comprehensive and clear regulatory framework for digital assets. However, it remains unclear how the actions or recommendations of the task force will influence the financial accounting rules to which we are subject.

Uncertainties in or changes to regulatory or financial accounting standards could result in the need to change our accounting methods and restate our financial statements, thereby impairing our ability to provide timely and accurate financial information, which could adversely affect our financial statements, result in a loss of investor confidence and more generally impact our business, operating results and financial condition.

We, our subsidiaries, officers, directors and affiliates have been in the past or currently are and may in the future be subject to substantial litigation, inquiries, investigations or enforcement.

We, our subsidiaries, officers, directors and affiliates have in the past faced or currently are facing and may in the future face: allegations; lawsuits; U.S. and foreign regulatory inquiries (including those related to the bankruptcy of the Genesis Entities), actions, requests, audits or investigations; disputes with our agents, affiliates or third-party service providers; and disputes related to false advertising claims. Responding to such proceedings, regardless of their ultimate outcome, can be time-consuming and expensive and divert the attention of senior management or otherwise be disruptive to normal business operations, and may adversely affect our reputation, business, financial condition and the market price of our Class A common stock. Adverse outcomes with respect to allegations, lawsuits, regulatory inquiries, audits or investigations may result in significant settlement costs or judgments, penalties and fines, or require us to modify our investment products or to stop serving certain customers or geographies, any of which could negatively impact our business. The outcome of such proceedings, and the related expenses, may be difficult to predict or estimate until late in the proceedings, which may last a number of years and be costly for us to maintain.

For example, DCG, who is our controlling shareholder, and DCG’s CEO, Barry Silbert, who is our founder and chairman of our board, have been subject to several lawsuits, regulatory inquiries, and investigations relating to the Genesis Entities, which filed for bankruptcy in January 2023. In January 2023, a securities class action lawsuit was brought against DCG and Mr. Silbert, alleging that DCG and Mr. Silbert caused Genesis to offer unregistered securities and misrepresent its financial condition in violation of the Securities Act. In October 2023, the NYAG brought charges against Gemini, the Genesis Entities, Genesis Capital’s former CEO, DCG and Mr. Silbert alleging violations of the New York Penal Law, New York General Business Law and New York Executive Law. In February 2024, the NYAG amended its complaint to expand the charges against Gemini, the Genesis Entities, Genesis Capital’s former CEO, DCG and Mr. Silbert to include harm to additional investors. Also in February 2024, the Genesis Entities entered into a settlement agreement with the NYAG to resolve the allegations against the Genesis Entities, which settlement was approved by the Bankruptcy Court of the Southern District of New York in May 2024. DCG and Mr. Silbert are subject to civil litigation arising out of the same or similar facts as alleged by the NYAG. On January 17, 2025, DCG agreed to entry of a cease-and-desist order and payment of a $38 million civil money penalty arising out of the SEC’s allegations that (i) DCG negligently engaged in conduct that misled investors about the impact of the default on Genesis Capital’s financial condition and (ii) DCG’s failure to exercise reasonable care in connection with certain statements concerning Genesis Capital’s financial condition created a materially false impression to the public regarding Genesis Capital’s financial health. In May 2025, the Genesis Litigation Oversight Committee (“GLOC”), on behalf of the post-reorganization Genesis Entities, filed a lawsuit in the Delaware Chancery Court against Genesis Capital’s former CEO, DCG, Mr. Silbert and other parties seeking to recover losses in kind of approximately $2.2 billion in digital assets. While we are not named as a party to these lawsuits or regulatory proceedings, there can be no assurance that these lawsuits, or any other lawsuits, regulatory proceedings or investigations that may be brought against our officers, directors or affiliates, will not have an adverse effect on us, including as a result of any negative impact to our brand and reputation due to our affiliation with DCG, Mr. Silbert and the Genesis Entities, which are

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former affiliates of ours due to the fact that the Genesis Entities were wholly owned by DCG prior to the Genesis Entities’ bankruptcy. Further, in May 2025, the GLOC also filed a lawsuit in the U.S. Bankruptcy Court for the Southern District of New York against DCG, Mr. Silbert and affiliated parties, including Grayscale, seeking to recover losses in kind of approximately $1.2 billion in digital assets and U.S. Dollars, of which Grayscale’s alleged liability is 105 BTC and 37,647.06 ETC (valued at approximately $12.6 million as of September 30, 2025).

The scope, determination and impact of claims, lawsuits, government and regulatory investigations, enforcement actions, disputes and proceedings to which we, our subsidiaries, directors, officers or affiliates are or may in the future be subject cannot be predicted with certainty, and may result in events such as:

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substantial payments to satisfy judgments, fines, penalties or settlement costs;

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substantial outside counsel legal fees and costs;

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additional compliance and license requirements;

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loss or non renewal of existing licenses or authorizations, or prohibition from or delays in obtaining additional licenses or authorizations, required for our business;

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the imposition of independent monitors or consultants;

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criminal sanctions or consent decrees;

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orders that restrict our business or prevent us from offering certain investment products;

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changes to our business model and practices, including our advertising and marketing efforts;

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delays or changes to planned investment product launches or development;

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damage to our brand and reputation;

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loss of productivity and high demand on director, executive officer and other employee time;

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termination or removal of certain directors, executive officers and other employees;

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barring of directors, executive officers or other employees from participating in our business in whole or in part; and

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“bad actor” disqualification, which could result in one or more of our investment products losing the ability to issue shares in a Rule 506 private offering for a significant period of time, which could impair our ability to manage the affairs of our existing investment products and to organize and offer new investment products.

In addition, certain of our subsidiaries are subject to periodic examination by regulatory authorities. If compliance failures or other violations are found during an examination, then a regulatory agency could initiate actions and impose sanctions for violations, including, for example, regulatory agreements, cease-and-desist orders, civil monetary penalties or termination of a license and lead to litigation by investors, any of which could adversely impact us.

Further, if we or any governmental agency believe that we have accepted investments by, or are otherwise holding digital assets of, any person or entity that is acting directly or indirectly in violation of U.S. or non-U.S. economic sanctions, AML laws, rules, regulations, treaties or other restrictions, or on behalf of any suspected terrorist or terrorist organization, suspected drug trafficker or senior foreign political figure suspected in engaging in foreign corruption, we or such governmental agency may freeze the digital assets of such person or entity. We may also be required to report and remit or transfer those digital assets to a governmental agency.

As a company in the financial services industry, we, our subsidiaries and affiliates depend to a significant extent on our relationships with our investors and counterparties, as well as our reputation for integrity and high-caliber professionalism. If an investor is not satisfied with our investment products, a counterparty has a dispute or if there are allegations of improper conduct by private litigants or regulators, whether the ultimate outcome is favorable or unfavorable to us, or if there is negative publicity and press speculation about us, whether or not valid, then our reputation may be harmed and may be more damaging to our businesses than to businesses in other industries.

Intellectual property rights claims may adversely affect our business and financial condition.

Our commercial success depends, in part, on our ability to develop and commercialize our investment products without infringing, misappropriating or otherwise violating the intellectual property or proprietary rights of third parties. In recent years, there has been considerable patent, copyright, trademark, domain name, trade secret and other intellectual property development activity in the digital asset industry, as well as litigation, based on allegations of infringement or other violations of intellectual property, including by large financial institutions.

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Our use of third-party software and other intellectual property rights may be subject to claims of infringement or misappropriation. The vendors who provide us with technology that we incorporate in our product offerings also could become subject to various infringement claims. We cannot guarantee that our internally developed or acquired technologies and content do not or will not infringe, misappropriate or otherwise violate the intellectual property rights of others.

We are not aware of any intellectual property rights claims that may prevent us from managing our investment products or holding digital assets, and we cannot guarantee our products will not infringe the intellectual property rights of others. Third parties may nonetheless assert intellectual property rights claims relating to the management of our investment products and the mechanics instituted for the investment in, holding of and transfer of digital assets. Any claims that our investment products or processes infringe the intellectual property rights of others, regardless of the merit or resolution of such claims, could cause us to incur significant costs in responding to, defending and resolving such claims, and may divert the efforts and attention of our management. As a result of such intellectual property infringement claims, we could be required or otherwise decide that it is appropriate to:

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pay third-party infringement claims;

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dissolve an investment product or liquidate its assets;

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discontinue using the processes subject to infringement claims;

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develop other intellectual property or investment products not subject to infringement claims, which could be time-consuming and costly or may not be possible; and

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license the intellectual property from the third party claiming infringement, which license may not be available on commercially reasonable terms.

The occurrence of any of the foregoing could result in unexpected expenses, stagnate or reduce our revenues and adversely affect our business and financial condition. Additionally, despite our efforts to ensure that our employees, contractors, consultants, vendors and service providers do not use the intellectual property and other proprietary information or know-how of third parties in their work for us, we may in the future be subject to claims that we, our employees or our contractors, consultants, vendors and service providers have inadvertently or otherwise used or disclosed intellectual property, copyrighted materials, trade secrets or other proprietary information of our competitors, former employers or other parties. Litigation may be necessary to defend against these claims. If we fail in defending against such claims, a court could order us to pay substantial damages and prohibit us from using technologies or features that are essential to our solutions, if such technologies or features are found to incorporate or be derived from the trade secrets or other proprietary information of these parties. In addition, we may lose valuable intellectual property rights. Even if we are successful in defending against these claims, such litigation could result in substantial costs and be a distraction to management. In addition, various “non-practicing entities,” and other intellectual property rights holders may in the future attempt to assert intellectual property claims against us or seek to monetize the intellectual property rights they own to extract value through licensing or other settlements.

Any failure to obtain, maintain, protect, defend or enforce our intellectual property rights could adversely affect our business, financial condition and results of operations.

Our success and our ability to compete depend in part upon our ability to obtain, maintain, protect, defend and enforce our intellectual property rights and technology, including our trademarks and domain names. We rely on trademark laws in the United States and internationally, our terms of service and other contractual provisions to protect our intellectual property rights from infringement, misappropriation or other violations.

Although we have registered trademarks and pending trademark applications, including the marks DROP GOLD®, G™, GRAYSCALE®, GRAYSCALE CRYPTO SECTORSˢᵐ, GRAYSCALE CRYPTO MINIS™ and GRAYSCALE INVESTMENTS®, and other intellectual property rights that are registered in the United States, our ability to enforce such intellectual property rights is subject to general litigation risks. Competitors may adopt service names similar to ours, thereby harming our ability to build brand identity and possibly leading to customer confusion or brand dilution. Additionally, unauthorized third parties may attempt to misuse our trademarks, trade names, domain names or brand identity, including through impersonation schemes or fraudulent activities in certain jurisdictions. While we take steps to address such misuse, our ability to prevent or mitigate these activities may be limited, and such fraudulent actions could harm our business, reputation or customer relationships. Furthermore, our trademarks may be opposed, contested, circumvented or found to be unenforceable, weak or invalid, and we may not be able to prevent third parties from infringing or otherwise violating them or using similar marks in a manner that causes confusion or dilutes the value or strength of our brand.

If we seek to enforce our rights, then we could be subject to litigation, including challenges to our registered intellectual property rights and claims that our intellectual property rights are invalid or are otherwise not enforceable in jurisdictions where our intellectual property rights are not registered. The steps we take to obtain, maintain, protect, defend and enforce our trademarks may be insufficient to effectively prevent third parties from infringing, misappropriating or otherwise violating our intellectual property rights, and there can be no assurance that our intellectual property rights will be sufficient to protect against unauthorized parties offering investment products that are substantially similar to ours.

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In order to protect our intellectual property and other proprietary rights, we may be required to expend significant resources to apply for, maintain, monitor and protect these rights. We will not be able to protect our rights if we do not detect their unauthorized use. We may also fail to maintain or be unable to obtain adequate protections for certain of our rights in the United States and abroad. Our rights may not receive the same degree of protection abroad that they would in the United States because of differences in laws, and effective intellectual property protection and enforcement mechanisms may not be available in those jurisdictions, which could make it difficult for us to stop the infringement, misappropriation, dilution or other violation of our intellectual property or marketing of competing products or solutions in violation of our intellectual property rights generally. We may need to expend additional resources to defend our intellectual property in such jurisdictions.

Legal standards relating to the validity, enforceability and scope of protection of intellectual property rights are uncertain and any changes in, or unexpected interpretations of, intellectual property laws may compromise our ability to enforce our intellectual property rights. If we cannot successfully enforce our rights, then we may lose the value of our brand and reputation and our competitive position or be exposed to significant liabilities or be required to seek licenses that may not be available on commercially acceptable terms, if at all.

Any claim or litigation alleging that we have infringed or otherwise violated intellectual property or other rights of third parties, with or without merit, and whether or not settled out of court or determined in our favor, could be time-consuming and costly to address and resolve, and could divert the time and attention of our management and technical personnel. The outcome of any litigation is inherently uncertain, and there can be no assurances that favorable final outcomes will be obtained in all cases. In addition, third parties may seek, and we may become subject to, preliminary or provisional rulings in the course of any such litigation, including potential preliminary injunctions requiring us to cease some or all of our operations. We may decide to settle such lawsuits and disputes on terms that are unfavorable to us. Similarly, if any litigation to which we are a party is resolved adversely, we may be subject to an unfavorable judgment that may not be reversed upon appeal, including being subject to a permanent injunction and being required to pay substantial monetary damages, including treble damages and attorneys’ fees, if we are found to have willfully infringed a party’s intellectual property rights. We may decide to settle such lawsuits and disputes on terms that are unfavorable to us. The terms of such a settlement or judgment may require us to cease some or all of our operations, pay substantial amounts to the other party or admit liability. Moreover, as part of any settlement or other compromise to avoid complex, protracted litigation, we may agree not to pursue future claims against a third party, including for claims related to alleged infringement of our intellectual property rights. Furthermore, because of the substantial amount of discovery required in connection with intellectual property litigation, there is a risk that some of our confidential information could be compromised by disclosure during any litigation regarding the enforcement of intellectual property rights, which may diminish the value of our brand and other intangible assets and allow competitors to more effectively mimic our products and solutions.

If we fail to comply with our obligations under license agreements with third parties or are unable to license rights on reasonable terms, then we may be required to pay damages and could potentially lose license rights that are critical to our business.

We license certain intellectual property and technology from third parties that is important to our business, such as our license agreement with CoinDesk Indices, Inc., pursuant to which we license the use of their digital asset price indices as the index prices for our investment products, and we may enter into additional license agreements in the future that provide us with licenses to valuable intellectual property or technology. If we fail to comply with any of the obligations under our existing license agreements, then we may be required to pay damages and the licensor may have the right to terminate the license. Such termination would cause us to lose valuable rights, and could prevent us from operating and administering our investment products or require us to dissolve an investment product and liquidate its assets. Our business would suffer if any current or future licenses terminate, the licensors fail to abide by the terms of the license, the licensed intellectual property rights are found to be invalid or unenforceable or we are unable to enter into necessary licenses on acceptable terms. Moreover, our licensors may own or control intellectual property that has not been licensed to us, and as a result, we may be subject to claims, regardless of their merit, that we are infringing or otherwise violating the licensor’s rights.

In the future, we may identify additional third-party intellectual property we may need to license to operate our business. However, such licenses may not be available on acceptable terms or at all. The licensing or acquisition of third-party intellectual property rights is a competitive area, and several more established companies may pursue strategies to license or acquire third-party intellectual property rights that we may consider attractive or necessary. In addition, companies that perceive us to be a competitor may be unwilling to assign or license rights to us. Even if such licenses are available, we may be required to pay the licensor substantial royalties, which could result in potentially higher expenses. In addition, such licenses may be nonexclusive, which could give our competitors access to the same intellectual property licensed to us. Any of the foregoing could have a material adverse effect on our competitive position, business, financial condition and results of operations.

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Cybersecurity incidents and other issues related to our information systems, technology and data may materially adversely affect us.

Cybersecurity incidents and cyberattacks have been occurring globally at more frequent and severe levels and will likely continue to increase in frequency and severity in the future. The digital asset industry is a particular target for cyberattacks. Cybersecurity incidents may occur through intentional or unintentional acts by individuals or groups having authorized or unauthorized access to our systems, custody accounts or our counterparties’ information, which may include confidential information. These individuals or groups include employees and third-party service providers, as well as hackers. The information and technology systems used by us and our service providers and other third parties, as well as relevant digital asset networks, are vulnerable to damage or interruption from, among other things: hacking, ransomware, malware and other computer viruses; denial of service attacks; network failures; computer and telecommunication failures; phishing attacks; infiltration by unauthorized persons; security breaches; usage errors by their respective professionals; power outages; terrorism; and catastrophic events such as fires, tornadoes, floods, hurricanes and earthquakes. Additionally, there is a risk that we may experience cybersecurity-related incidents as a result of our employees, service providers and other third parties working remotely on less secure systems and environments.

While we take efforts to protect our systems, custody accounts and data, including establishing internal processes and implementing technological measures designed to provide multiple layers of security, and contract with third-party service providers to take similar steps, we have experienced cybersecurity breaches in the past, and there can be no assurance that our safety and security measures (and those of our third-party service providers) will prevent damage to, or interruption or breach of, our systems, custody accounts, data (including personal data) and operations. We have recently taken steps to expand and enhance our cybersecurity controls and practices and, as cybersecurity-related threats continue to evolve, we may be required to expend significant additional resources to continue to modify or enhance our protective measures or to investigate and remediate any information security vulnerabilities. Nevertheless, it is possible we could suffer an impact or disruption that could materially adversely affect us.

In particular, the digital assets held by us and our investment products may be appealing targets to hackers or malware distributors seeking to destroy, damage or steal our digital assets and will only become more appealing as our digital assets grow. To the extent that we or the Custodians are unable to identify and mitigate or stop new security threats or otherwise adapt to technological changes in the digital asset industry, our digital assets may be subject to theft, loss, destruction or other attack. For more information on the risks related to the custody of digital assets held by us and our investment products, see “—Risk Factors Related to Our Business— We rely on Coinbase Custody to provide us and our investment products with critical custody services for a substantial amount of the digital assets for which we offer investment products, including the digital assets and investment products that would be part of our Principal Investments. The failure of Coinbase Custody or other custodians to adequately safeguard these digital assets, or any disruptions to its services, could materially adversely affect our business and harm investors in our investment products.”

We believe that the security procedures we have in place, including, but not limited to: offline storage, or cold storage, for a substantial portion of our digital assets; multiple encrypted private key “shards”; usernames; and passwords and two-step verification are reasonably designed to safeguard our digital assets. Nevertheless, these security procedures cannot guarantee the prevention of any loss due to a security breach, software defect or catastrophic event. Electronic transmissions of data can be subject to attack, interception, loss or corruption. In addition, computer viruses and malware can be distributed and spread rapidly over the internet and could infiltrate our systems or those of our investment vehicles or third-party service providers. Infiltration of our systems or those of our investment vehicles or third-party service providers could in the future lead to disruptions in systems, accidental or unauthorized access to or disclosure, loss, destruction, disablement or encryption of, use or misuse of or modification of confidential, sensitive or otherwise protected information (including personal data) and the corruption of data. Additionally, because a portion of our digital assets from time to time will be held in hot storage, such digital assets will be more vulnerable to a potential hack or other cyberattack that could lead to a loss of investment product assets.

Our security procedures and operational infrastructure may be breached due to the actions of outside parties, error or malfeasance of an employee, a Custodian or otherwise, and as a result, an unauthorized party may obtain access to a custody account, the relevant private keys (and therefore digital assets) or other data. Additionally, outside parties may attempt to fraudulently induce employees of ours or the Custodians to disclose sensitive information in order to gain access to our infrastructure. As the techniques used to obtain unauthorized access, disable or degrade service, or sabotage systems change frequently, or may be designed to remain dormant until a predetermined event and often are not recognized until launched against a target, the Custodians and we may be unable to anticipate these techniques or implement adequate preventative measures. Moreover, the Custodians will not be liable for any claims or losses arising out of or relating to the acts and omissions of any unauthorized third parties, except to the extent such losses are caused by the Custodians’ negligence, fraud or willful misconduct.

An actual or perceived breach of a custody account could harm our operations, result in loss of digital assets, damage our reputation and negatively affect the market perception of our investment products, all of which could adversely affect our results of operations. We may also be required to dissolve a particular investment product and liquidate its assets.

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Moreover, there could be public announcements regarding any cybersecurity-related incidents and any steps we take to respond to or remediate such incidents, and if analysts or investors perceive these announcements to be negative, it could, among other things, have a substantial adverse effect on the price of our Class A common stock. Further, any publicized security problems affecting our business or those of third parties with whom we are affiliated or otherwise conduct business may discourage investors from doing business with us, which could have a material and adverse effect on our business, financial condition and results of operations.

It is difficult or impossible to defend against every risk being posed by changing technologies, as well as criminals’ intent to commit cybercrime, and these efforts may be unsuccessful in anticipating, preventing, detecting or stopping attacks or reacting in a timely manner. As technological change occurs, security threats will likely evolve, and previously unknown threats may emerge. The increasing sophistication and resources of cybercriminals and other non-state threat actors and increased actions by nation-state actors make it difficult to keep up with new threats and could result in a breach of security. Such threats may see their frequency increased, and effectiveness enhanced, by the use of AI. Furthermore, we may become a greater target of security threats as our size and reputation increases. If we are unable to identify and mitigate or stop new security threats or we are unable to adapt to technological changes necessary to secure and safeguard our systems, digital assets or data, then our data and our digital assets or those of our investment products may be subject to theft, loss, destruction or other attack, which could result in a loss of such data or digital assets or materially adversely affect our business, financial condition and results of operations. Additionally, we cannot guarantee that our insurance coverage would be sufficient to cover any such losses.

The security of the information and technology systems used by us and our service providers may continue to be subjected to cybersecurity threats that could result in material failures or disruptions in our business. If these systems are compromised, become inoperable for extended periods of time or cease to function properly, then we or a service provider may have to make a significant investment to fix or replace them. The failure of these systems, or any disaster recovery plans we develop, could cause significant interruptions in operations and result in a failure to maintain the security, confidentiality or privacy of sensitive data, including personal information relating to stockholders (and the beneficial owners of stockholders), as well as the security of our digital assets. Such failure could harm our reputation, subject us to legal claims and otherwise materially adversely affect our results of operations.

To the extent the operation of our systems relies on our third-party service providers, through either a connection to, or an integration with, such third parties’ systems, the risk of cybersecurity attacks and loss, corruption, or unauthorized access to or publication of our information or the confidential information and/or personal data of investment vehicles and employees may increase. Third-party risks may include insufficient security measures, data location uncertainty, and the possibility of storing data in jurisdictions where laws or security measures may be inadequate. In addition, certain of our systems are shared with DCG, and any cybersecurity attack against, or loss, corruption, or unauthorized access to information on, DCG’s systems could impact us. Our ability to monitor our third-party service providers’ and DCG’s data security practices may be limited. Although we generally have agreements relating to cybersecurity and data privacy in place with our third-party service providers, such third-party service providers may not comply with such cybersecurity and data security requirements. In addition, we cannot guarantee that such agreements will prevent the accidental or unauthorized access to or disclosure, loss, destruction, disablement or encryption of, use or misuse of or modification of data (including personal data) or enable us to obtain adequate or any reimbursement from our third-party service providers in the event we should suffer any such incidents. Due to applicable laws and regulations or contractual obligations, we may be held responsible for any information security failure or cybersecurity attack attributed to our third-party service providers as they relate to the information we share with them. A vulnerability in a third-party service provider’s or DCG’s software or systems, a failure of our third-party service providers’ or DCG’s safeguards, policies or procedures, or a breach of a third-party service provider’s or DCG’s software or systems could result in the compromise of the confidentiality, integrity or availability of our systems, including those shared with DCG, or the data housed in a solution provided by our third-party service providers, which could materially adversely affect our business, financial condition and results of operations.

Our business depends on our ability to effectively invest in, implement improvements to and properly maintain the uninterrupted operation, security and integrity of our information technology and business systems.

Our business depends on maintaining effective information technology systems as well as the integrity and timeliness of the data we use to operate our business. It is possible that hardware failures or errors in our systems could result in data loss or corruption, or cause the information that we collect to be incomplete, or contain inaccuracies that investors regard as significant. If our data were found to be inaccurate or unreliable, or became inaccessible, whether due to failures, errors or other reasons, or if we, or any of our third-party service providers, especially the software systems of our index providers and the Custodians, were to fail to effectively maintain such information systems and data integrity, then we could experience operational disruptions that may impact our investment products, individuals and service providers and hinder our ability to offer our investment products, retain and attract investors, report financial results timely and accurately and maintain regulatory compliance, among other things.

Our success is dependent, in large part, on maintaining the effectiveness of existing technology systems and continuing to deliver and enhance technology systems that support our business processes in a cost-efficient and resource-efficient manner and enable us to analyze and manage data in a comprehensive manner. Increasing and shifting regulatory and legislative requirements are likely to place additional demands on our information technology infrastructure that could have a direct impact on resources available for other projects tied to our strategic initiatives.

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Also, in the event of damage or interruption, our insurance policies may not adequately compensate us for any losses and liabilities arising from security breaches, cyberattacks, and other types of unlawful activity, or any resulting disruptions from such events. System failures or outages could compromise our ability to perform these functions in a timely manner, which could harm our ability to conduct business or delay our financial reporting. Such failures could adversely affect our results of operations and financial condition. In addition, certain of our third-party service providers are required to notify us if they experience a security breach or unauthorized disclosure of certain personal information, or, in some cases, confidential data or information of ours or service providers, and their failure to timely notify us of such a breach or disclosure may cause us to incur significant costs or otherwise harm our business.

Additionally, any actual or perceived breach or cybersecurity attack directed at financial institutions, trading exchanges or similar companies, whether or not we are directly impacted, could lead to a general loss of investor confidence in the security of internet transactions or confidential personal information, which could negatively impact us, including the market perception of the effectiveness of our security measures and technology infrastructure. As a result, our costs and the resources we devote to protecting against these advanced threats and their consequences may continue to increase over time.

Despite our implementation of a variety of security measures, our information technology systems could be subject to physical or electronic compromises and similar disruptions from unauthorized tampering, or to weather-related disruptions where our systems are hosted. Prolonged interruption in the availability, or reduction in the speed or other functionality, of our systems and investment products could materially harm our reputation and business. Frequent or persistent interruptions in accessing our systems and services could cause investors to believe that our systems and services are unreliable, leading them to switch to our competitors, and could permanently harm our reputation and business.

We may need to develop new systems to meet current market standards and keep pace with continuing changes in information processing technology and evolving industry and regulatory standards. Further, system development projects are long term in nature, may be more costly than expected to complete and may not deliver the expected benefits upon completion. In addition, we may not be able to adequately assess the functionality and data integrity and security impacts of new or significantly changed products, services, business processes or infrastructure that we use. Our failure to effectively implement improvements to and properly maintain the uninterrupted operation and integrity of our information technology and other business systems, as well as any write-downs in connection with the obsolescence of our technology, could materially adversely affect our business, financial condition and results of operations.

We are incorporating AI technologies into some of our products and processes. These technologies may present business, compliance, and reputational risks.

We currently use, and expect to continue to use, machine learning (“ML”) and AI, both proprietary and third-party technologies, to improve our products and processes in certain circumstances, such as to increase the efficiency of research and development and information technology functionality, and have plans to expand our use of AI in the future. Our research and development of such technology remains ongoing, and may be costly and yield inefficient results. As with many new and emerging technologies, AI presents numerous risks and challenges that could adversely affect our business. If we fail to keep pace with rapidly evolving AI technological developments, especially in the financial technology sector, our competitive position and business results may suffer.

At the same time, use of AI has recently become the source of significant media attention and political debate. Ineffective or inadequate AI development or deployment practices by us or others could result in incidents that impair the acceptance of AI solutions or cause harm to individuals, customers or society, or result in our platform and services not working as intended. Human review of certain outputs may be required. We may license AI technologies from third parties that use models trained on data that could potentially violate intellectual property, privacy, or other third-party rights or violate law. These AI technologies may also produce results or generate content that is inaccurate or misleading or that cannot be explained by data. These AI technologies may incorporate data from third-party sources, including information they input into the AI tools, which may expose us to risks associated with data rights and protection.

Further, AI and ML models require training on training datasets prior to production use, and in some instances, AI algorithms or training methodologies that may be flawed. Training on incomplete, inadequate, inaccurate, biased, or otherwise poor quality data may result in models failing to provide acceptable results. The introduction of AI technologies, particularly generative AI, that have unintended consequences, unintended usage or customization by our investment vehicles, are contrary to responsible AI principles, or are otherwise controversial because of their impact on human rights, privacy, employment, or other social, economic, or political issues, may cause us to experience brand or reputational harm, adversely affecting our business and consolidated financial statements, including due to enhanced governmental or regulatory scrutiny, litigation, compliance issues, ethical concerns, confidentiality or security risks, as well as other factors that could materially adversely affect our business, financial condition and results of operations.

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Our ability to mitigate risks associated with disclosure of our confidential information, including in connection with our use of AI systems, will depend on our implementation, maintenance, monitoring and enforcement of appropriate technical and administrative safeguards, policies and procedures governing the use of AI systems in our business. Additionally, any output created by us using AI tools may not be subject to copyright protection, which may adversely affect our intellectual property rights in, or ability to commercialize or use, any such content. In the United States, a number of civil lawsuits have been initiated related to the foregoing and other concerns, any one of which may, among other things, may require us to limit the ways in which AI systems are used and trained and may affect our ability to develop our AI-powered products and solutions. For example, the output produced by AI tools may include information subject to certain privacy or right of publicity laws or constitute an unauthorized derivative work of the copyrighted material used in training the underlying AI model, any of which could also create a risk of liability for us, or adversely affect our business or operations. AI-related lawsuits to date have generally focused on AI service providers, which may increase our risks of liability. In addition, AI technology in general has resulted in, and may in the future result in, cybersecurity breaches, incidents or disruptions of its users, that have implicated the personal information of such users or their customers. To the extent that we do not have sufficient rights to use the data or other material or content used in or produced by the AI tools used in our business, if we fail to adopt and implement sufficient governance controls over our use of AI, or if we experience cybersecurity incidents in connection with our use of AI, any of the foregoing could adversely affect our reputation and expose us to legal liability or regulatory risk, including with respect to third-party intellectual property, privacy, data protection and cybersecurity, publicity, contractual or other rights.

The regulatory framework governing the use of AI and ML technology is rapidly evolving, and we cannot predict how future legislation and regulation will impact our ability to offer products or services that we develop which leverage AI and ML technology.

The regulatory framework for AI and ML technology is rapidly evolving, and many regulatory bodies and federal, state, and foreign governments have globally introduced or are currently considering new laws and regulations relating to such technology. As a result, implementation standards and enforcement practices are also likely to remain uncertain for the foreseeable future, and we cannot determine the impact future laws, regulations, or standards may have on our business, or how best to respond to them in future.

The Trump administration may continue to rescind federal orders and/or administrative policies relating to AI and ML technology, or may implement new executive orders and/or other rulemaking relating to AI and ML technology in the future. Any such changes at the federal level could require us to expend significant resources to modify our products, services or operations to ensure compliance or remain competitive. U.S. legislation related to AI and ML technologies has been introduced at the federal level and is advancing at the state level.

In Europe, the E.U. AI Act established broad obligations for the development and use of AI-based technologies in the European Economic Area based on their potential risks and level of impact. The E.U. AI Act includes requirements around transparency, conformity assessments and monitoring, risk assessments, human oversight, security, accuracy, general purpose AI and foundation models.

Any failure or perceived failure by us to comply with AI technology-related laws, rules and regulations could result in proceedings or actions against us by individuals, consumer rights groups, government agencies or others. We could incur significant costs in investigating and defending such claims and, if found liable, pay significant damages or fines or be required to make changes to our business. Further, these proceedings and any subsequent adverse outcomes may subject us to significant negative publicity and an erosion of trust. If any of these events were to occur, our business, financial condition and results of operations could be materially adversely affected.

Moreover, it is possible that additional laws and regulations will be adopted in the United States and foreign jurisdictions, or that existing laws and regulations may be interpreted in ways that would affect the way in which we use AI and ML technology. We may need to expend resources to modify our products or services or incur new research and development costs in order to comply with new laws or regulations. Further, the cost of compliance could be significant and may increase our operating expenses, which could materially adversely affect our business, financial condition and results of operations. Changes to existing regulations, their interpretation or implementation or new regulations could impede our use of AI and ML technology and also may increase the burden and cost of research and development in this area.

We are subject to stringent laws and regulations regarding data privacy and cybersecurity in the United States. Many of these laws and regulations are subject to change and reinterpretation and could result in claims, changes to our business practices, monetary penalties, increased cost of operations or other harm to our business.

We and our third-party service providers are subject to a variety of federal, state and local laws, directives, rules, policies, industry standards and regulations, as well as contractual obligations, relating to data privacy and security. This regulatory framework is continuously evolving, and as a result, interpretation and implementation standards and enforcement practices are likely to remain uncertain, and may require us to incur additional costs and restrict our business operations, as well as change how we use, collect, store, transfer or otherwise process certain types of data and to implement new processes.

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In the United States, federal law restricts certain collection, processing, storage, use and disclosure of personal data, requires notice to individuals of privacy practices and provides individuals with certain rights to prevent the use and disclosure of certain nonpublic or otherwise legally protected information. These rules also impose requirements for the safeguarding and proper destruction of personal data through the issuance of data security standards or guidelines. The U.S. government, including Congress, the Federal Trade Commission (“FTC”), the CFPB and the Department of Commerce, has announced that it is reviewing the need for greater regulation for the collection, use and other processing of information concerning consumer behavior on the internet, including regulation aimed at restricting certain targeted advertising practices. There is also a risk of enforcement actions in response to rules and regulations promulgated under the authority of federal agencies, state attorneys general, legislatures and consumer protection agencies. In addition, privacy advocates and industry groups have proposed and may propose new and different self-regulatory standards that either legally or contractually apply to us. If we fail to follow these standards, even if no personal data is compromised, then we may incur significant fines or experience a significant increase in costs.

Also, many states have adopted legislation that regulates how businesses operate online, including measures relating to privacy, data security, data breaches and the protection of sensitive and personal information, requiring businesses to provide notice to customers whose personally identifiable information has been disclosed as a result of a data breach. The laws are not consistent, as certain laws may be more stringent or broader in scope, or offer greater individual rights, with respect to sensitive and personal information than federal, international or other state laws, and such laws may differ from each other, which may complicate compliance efforts that may become costly in the event of a widespread data breach. Failure to comply with, for example, the California Consumer Privacy Act, as amended by the California Privacy Rights Act of 2020, the California Online Privacy Protection Act or any other similar state or federal law or any future changes in laws or regulations relating to privacy, data protection and information security (particularly any new or modified laws or regulations that require enhanced protection of certain types of data or new obligations with regard to data retention, transfer or disclosure), can result in significant liability, including civil penalties and statutory damages as well as a private right of action for certain breaches. The effects of such laws and/or regulations may require us to modify our data processing practices and policies and could greatly increase our expenses, require significant changes to our operations or even prevent us from providing certain investment products in jurisdictions in which we currently operate and in which we may operate in the future, or require us to incur potential liability in an effort to comply with such legislation.

In addition, the New York State Department of Financial Services (“NYDFS”) issued Cybersecurity Requirements for Financial Services Companies, which took effect in 2017, and which require banks, insurance companies and other financial services institutions regulated by the NYDFS to establish and maintain a cybersecurity program designed to protect consumers and ensure the safety and soundness of New York State’s financial services industry. The cybersecurity regulation adds specific requirements for these institutions’ cybersecurity compliance programs and imposes an obligation to conduct ongoing, comprehensive risk assessments. On an annual basis, each institution is required to submit a certification of compliance with these requirements. We may in the future become subject to such NYDFS regulations and requirements, which could subject us to additional investigations and examinations of our compliance programs.

Further, the publication of our privacy policies and other statements that provide promises and assurances about data privacy and security can subject us to potential government or legal action if they are found to be deceptive, unfair or misrepresentative of our actual practices. Any failure or perceived failure by us or our third-party service providers to comply with our posted privacy policies or with any applicable federal, state or similar foreign laws, rules, regulations, industry standards, policies, certifications or orders relating to data privacy and security, or any compromise of security that results in theft, unauthorized access, acquisition, use, disclosure or misappropriation of personal data, could result in significant awards, fines, civil or criminal penalties or judgments, proceedings or litigation by governmental agencies or investors, including class action privacy litigation in certain jurisdictions and negative publicity and reputational harm, any of which could have an adverse effect on our reputation, business, financial condition and results of operations.

Evolving compliance and operational requirements impose significant costs, such as costs related to organizational changes, implementing additional protection technologies, training employees and engaging consultants, which are likely to increase over time, and may require us to modify or restrict our data processing practices and policies, distract management or divert resources from other initiatives and projects.

We may face particular privacy, data security and data protection risks in connection with the GDPR and other non-U.S. data protection regulations.

The fact that some of our investors and users of our website are residents of the U.K. and the European Union subjects us or may subject us to the E.U. General Data Protection Regulation (“GDPR”). The GDPR regulates the collection, control, sharing, disclosure, use and other processing of personal data and imposes stringent data protection requirements with significant penalties, and the risk of civil litigation, for noncompliance. Among other requirements, the GDPR regulates transfers of personal data subject to the GDPR to third countries that have not been found to provide adequate protection to such personal data, including the United States. We are also subject to the U.K. General Data Protection Regulation (i.e., a version of the GDPR as implemented into U.K. law), exposing us to two parallel regimes, each of which authorizes similar fines and other potentially divergent enforcement actions for certain violations.

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If we are unable to implement a valid mechanism for personal data transfers from Europe and the U.K., then we will face increased exposure to regulatory actions, substantial fines and injunctions against processing personal data from Europe and the U.K. Inability to export personal data may also limit our ability to collaborate with third-party service providers outside of Europe and the U.K. or cause us to change the geographical location or segregation of our relevant systems and operations. Further, the current existing framework regarding personal data transfers from Europe and the U.K. is uncertain, and such uncertainty may increase our costs and our ability to efficiently process personal data imported from Europe and the U.K. Additionally, other countries outside of Europe and the U.K. have enacted or are considering enacting similar cross-border data transfer restrictions and laws requiring local data residency, which could increase the cost and complexity of delivering our investment products and operating our business. The types of challenges we face in Europe and the U.K. will likely also arise in other jurisdictions that adopt regulatory frameworks of equivalent complexity. While we have taken steps to mitigate the impact on us with respect to transfers of data, such as implementing standard contractual clauses, the efficacy and longevity of these transfer mechanisms remain uncertain.

Other countries have also passed, or are considering passing, laws requiring local data residency or restricting the international transfer of data. These changes may lead to additional costs and increase our overall risk exposure. Any inability to adequately address data privacy or security-related concerns, even if unfounded, or to comply with applicable laws, regulations, standards and other obligations relating to data privacy and security, could result in litigation, breach notification obligations, regulatory or administrative sanctions, additional cost and liability to us, harm to our reputation and brand, and damage to our relationships with investors and users of our website and have an adverse effect on our business, financial condition and results of operations.

Any theft, loss, damage to or other misappropriation or inadvertent disclosure of, or inappropriate access to, the data that we possess could have an adverse impact on our business and subject us to regulatory actions and litigation.

Our business and relationships with third parties are dependent on our ability to maintain the confidentiality of sensitive information (including data about users of our website and our employees). Although we are not aware of any material incidents to date, unauthorized access, or failure of our controls with respect to granting access, to our systems, or failure of our other data loss prevention controls, have in the past occurred and may occur in the future, resulting in theft, loss, damage to or other misappropriation of such information. Our employees or third-party services providers may in the future, inadvertently or deliberately, disclose confidential information and our systems or systems of our third-party service providers may in the future be inadvertently or deliberately exploited, resulting in disclosure of confidential information.

Any theft, loss, damage to or other misappropriation or inadvertent disclosure of confidential information could have a material adverse impact on our competitive position, our relationships with our investors and third-party service providers and reputation and could subject us to regulatory inquiries, enforcement and fines, civil litigation and possible financial liability or costs. To the extent any of these events involve personal information, the risks of enhanced regulatory scrutiny and the potential financial liabilities are exacerbated, particularly under data protection regulations such as the GDPR.

We are a holding company and, upon completion of the IPO Reorganization and this offering, our principal asset will be % of the outstanding LLC Units. See “Organizational Structure.” We have no independent means of generating income from operations. Grayscale Operating, LLC is, and will continue to be, treated as a partnership for U.S. federal income tax purposes and, as such, generally will not be subject to U.S. federal income tax. Instead, the taxable income of Grayscale Operating, LLC will be allocated to holders of LLC Units, including us. Accordingly, we will incur income taxes on our allocable share of any net taxable income of Grayscale Operating, LLC. We will also incur expenses related to our operations and will have obligations to make payments under the Tax Receivable Agreement. As the sole managing member of Grayscale Operating, LLC, we intend to cause Grayscale Operating, LLC to make distributions to the holders of LLC Units and us, in amounts sufficient to (i) generally cover all applicable taxes payable by us and the holders of LLC Units, (ii) allow us to make any payments required under the Tax Receivable Agreement, (iii) fund dividends to our stockholders in accordance with our dividend policy, to the extent that our board of directors declares such dividends, and (iv) pay any other expenses we may incur.

Deterioration in the financial conditions, earnings or cash flow of Grayscale Operating, LLC and its subsidiaries for any reason could limit or impair their ability to pay such distributions. Additionally, to the extent that we need funds and Grayscale Operating, LLC is restricted from making such distributions to us under applicable law or regulation or contractual agreements, we may not be able to obtain such funds on terms acceptable to us, or at all, and, as a result, could suffer a material adverse effect on our liquidity and financial condition.

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Under the Amended LLC Agreement, Grayscale Operating, LLC will generally be required from time to time to make pro rata distributions in cash to us and the other holders of LLC Units at certain assumed tax rates in amounts that are intended to be sufficient to cover the taxes on our and the other LLC Unit holders’ respective allocable shares of the taxable income of Grayscale Operating, LLC. As a result of (i) potential differences in the amount of net taxable income allocable to us and the other LLC Unit holders and (ii) the favorable tax benefits that we anticipate receiving from (a) acquisitions of interests in Grayscale Operating, LLC in connection with acquisitions by Grayscale Investments, Inc. of LLC Units from the Pre-IPO LLC Members in connection with this offering and future taxable redemptions or exchanges of LLC Units for shares of our Class A common stock or cash and (b) payments under the Tax Receivable Agreement, we expect that these tax distributions will be in amounts that exceed our tax liabilities and obligations to make payments under the Tax Receivable Agreement. Our board of directors will determine the appropriate uses for any excess cash so accumulated, which may include, among other uses, dividends, repurchases of our Class A common stock and the payment of other expenses. We will have no obligation to distribute such cash (or other available cash other than any declared dividend) to our stockholders. No adjustments to the redemption or exchange ratio of LLC Units for shares of Class A common stock will be made as a result of either (i) any cash distribution by us or (ii) any cash that we retain and do not distribute to our stockholders. To the extent that we do not distribute such excess cash as dividends on our Class A common stock and instead, for example, hold such cash balances or lend them to Grayscale Operating, LLC, holders of LLC Units would benefit from any value attributable to such cash balances as a result of their ownership of Class A common stock following a redemption or exchange of their LLC Units. See “Certain Relationships and Related Party Transactions—Amended LLC Agreement.”

DCG will control approximately % of the combined voting power of our common stock (or % if the underwriters exercise their option to purchase additional shares of Class A common stock in full) after the completion of this offering and the application of the net proceeds from this offering. Further, pursuant to the Stockholders Agreement we and the Pre-IPO LLC Members will enter into, the Pre-IPO LLC Members, which are controlled by DCG, may approve or disapprove certain matters requiring approval by our stockholders. See “Certain Relationships and Related Party Transactions—Stockholders Agreement.”

Further, upon completion of this offering, subject to the Voting Limitation and until the Class B common stock beneficially owned by DCG and its affiliates represents less than 20% of the total number of the then outstanding shares of our common stock, our Class B common stock will have ten votes per share, and our Class A common stock will have one vote per share. Because of the ten-to-one voting ratio between our Class B common stock and Class A common stock, DCG will control a majority of the combined voting power of all of our Class A common stock and Class B common stock and therefore will be able to control all matters submitted to our stockholders for approval until a significant portion of such shares of outstanding Class B common stock have redeemed or exchanged for shares of Class A common stock. This concentrated control will limit or preclude the ability of our other investors to influence corporate matters for the foreseeable future. For example, DCG will have sufficient voting power to determine the outcome with respect to elections of directors, amendments to our certificate of incorporation, amendments to our bylaws that are subject to a stockholder vote, increases to the number of shares available for issuance under our equity incentive plans or adoption of new equity incentive plans, and approval of any merger, consolidation, sale of all or substantially all of our assets or other major corporate transaction requiring stockholder approval for the foreseeable future.

This concentration of ownership and voting power may also entrench our management and our board or delay, defer or even prevent an acquisition by a third party or other change of control of our company, which could deprive you of an opportunity to receive a premium for your shares of Class A common stock and may make some transactions more difficult or impossible without the support of DCG, even if such events are in the best interests of minority stockholders. Furthermore, this concentration of voting power with DCG may have a negative impact on the price of our Class A common stock.

We cannot predict whether our dual-class structure, combined with the concentrated control of DCG, will result in a lower or more volatile market price of our Class A common stock or in adverse publicity or other adverse consequences. Certain stock index providers exclude or limit the ability of companies with multi-class share structures from being added to certain of their indices. Accordingly, the dual-class structure of our common stock would make us ineligible for inclusion in indices with such restrictions. Given the sustained flow of investment funds into passive strategies that seek to track certain indices, exclusion from stock indices would likely preclude investment by many of these funds and could make our Class A common stock less attractive to other investors. In addition, several stockholder advisory firms and large institutional investors have been critical of the use of multi-class structures. Such stockholder advisory firms may publish negative commentary about our corporate governance practices or our capital structure, which may dissuade large institutional investors from purchasing shares of our Class A common stock. As a result, the market price of our Class A common stock could be materially adversely affected.

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DCG’s interests may not be fully aligned with yours, or ours, which could lead to actions that are not in your, or our, best interests. Because DCG, via its ownership interests in the Pre-IPO LLC Members, holds a majority of its economic interests in our business through Grayscale Operating, LLC rather than through Grayscale Investments, Inc., it may have conflicting interests with holders of shares of our Class A common stock. For example, DCG may have a different tax position from us, which could influence its decisions regarding whether and when we should dispose of assets or incur new or refinance existing indebtedness, especially in light of the existence of the Tax Receivable Agreement that we entered into in connection with the Private Placement Reorganization, and whether and when we should undergo certain changes of control for purposes of the Tax Receivable Agreement or terminate the Tax Receivable Agreement. In addition, the structuring of future transactions may take into consideration these tax or other considerations even where no similar benefit would accrue to us. Pursuant to the Bipartisan Budget Act of 2015, if the IRS makes audit adjustments to Grayscale Operating, LLC’s federal income tax returns, it may assess and collect any taxes (including any applicable penalties and interest) resulting from such audit adjustment directly from Grayscale Operating, LLC. If, as a result of any such audit adjustment, Grayscale Operating, LLC is required to make payments of taxes, penalties and interest, Grayscale Operating, LLC’s cash available for distributions to us may be substantially reduced. See “Certain Relationships and Related Party Transactions—Tax Receivable Agreement.”

In addition, DCG’s significant ownership in us and resulting ability to effectively control us may discourage someone from making a significant equity investment in us, or could discourage transactions involving a change in control, including transactions in which you as a holder of shares of our Class A common stock might otherwise receive a premium for your shares over the then-current market price. Further, DCG is an active investor in other digital asset projects and growth companies, and may make decisions that favor other projects in which it has invested.

We have opted out of Section 203 of the General Corporation Law of the State of Delaware (the “DGCL”), which prohibits a publicly held Delaware corporation from engaging in a business combination transaction with an interested stockholder for a period of three years after the interested stockholder became such unless the transaction fits within an applicable exemption, such as board approval of the business combination or the transaction which resulted in such stockholder becoming an interested stockholder. Therefore, after the 180-day lock-up period expires, the Pre-IPO LLC Members will be able to transfer control of us to a third party by transferring their shares of our common stock (subject to certain restrictions and limitations), which would not require the approval of our board of directors or our other stockholders.

The doctrine of “corporate opportunity” will have limited application to the Pre-IPO LLC Members, our directors and officers and their respective affiliates.

Our certificate of incorporation and Stockholders Agreement will provide that, to the fullest extent permitted by law, the doctrine of “corporate opportunity” under Delaware law will only apply against the Pre-IPO LLC Members, our directors and officers and their respective affiliates for competing activities related to the same or similar core lines of business in which we or our affiliates now engage in or propose to engage in. This doctrine will not apply to any business activity other than those activities. See “Certain Relationships and Related Party Transactions—Amended LLC Agreement.” Furthermore, the Pre-IPO LLC Members have business relationships outside of our business.

As described under “Organizational Structure,” acquisitions by Grayscale Investments, Inc. of LLC Units from certain of our existing equityholders in connection with this offering, any future offerings and any future taxable redemptions or exchanges by the Pre-IPO LLC Members of LLC Units for shares of our Class A common stock or cash, as well as other transactions described herein, are expected to result in tax basis adjustments to the assets of Grayscale Operating, LLC. These tax basis adjustments generated over time may increase (for tax purposes) the depreciation and amortization deductions available to Grayscale Investments, Inc. and, therefore, may reduce the amount of U.S. federal, state and local income tax that Grayscale Investments, Inc. would otherwise be required to pay in the future. These tax attributes would not be available to us in the absence of those transactions. The anticipated tax basis adjustments are expected to reduce the amount of tax that we would otherwise be required to pay in the future.

We have entered into the Tax Receivable Agreement with the Pre-IPO LLC Members that provides for the payment by us to the Pre-IPO LLC Members of 85% of the amount of cash savings, if any, in U.S. federal, state and local income tax or franchise tax that we actually realize as a result of (i) any increase in tax basis in Grayscale Operating, LLC’s assets resulting from (a) acquisitions by Grayscale Investments, Inc. of LLC Units from the Pre-IPO LLC Members in connection with this offering, (b) the purchase of LLC Units from any of the Pre-IPO LLC Members using the net proceeds from any future offering, (c) redemptions or exchanges by the Pre-IPO LLC Members of LLC Units for shares of our Class A common stock or cash or (d) payments under the Tax Receivable Agreement and (ii) tax benefits related to imputed interest resulting from payments made under the Tax Receivable Agreement. The payment obligations under the Tax Receivable Agreement are our obligations and not obligations of Grayscale Operating, LLC.

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We expect that, as a result of the increases in the tax basis of the tangible and intangible assets of Grayscale Operating, LLC attributable to the redeemed or exchanged LLC Units, the payments that we may make to the existing Pre-IPO LLC Members could be substantial. For example, if we acquired all of the LLC Units of the Pre-IPO LLC Members in taxable transactions as of this offering, based on an initial public offering price of $ per share (the midpoint of the estimated initial public offering price range set forth on the cover page of this prospectus) and on certain assumptions, including that (i) there are no material changes in relevant tax law and (ii) we earn sufficient taxable income in each year to realize on a current basis all tax benefits that are subject to the Tax Receivable Agreement, we expect that the resulting reduction in tax payments for us, as determined for purposes of the Tax Receivable Agreement, would aggregate to approximately $ million, substantially all of which would be realized over the next 15 years, and we would be required to pay the Pre-IPO LLC Members 85% of such amount, or $ million, over the same period. The actual increases in tax basis with respect to future taxable redemptions, exchanges or purchases of LLC Units, as well as the amount and timing of any payments we are required to make under the Tax Receivable Agreement in respect of the acquisition of LLC Units from Pre-IPO LLC Members in connection with this offering or future taxable redemptions, exchanges or purchases of LLC Units, may differ materially from the amounts set forth above because the potential future reductions in our tax payments, as determined for purposes of the Tax Receivable Agreement, and the payments we will be required to make under the Tax Receivable Agreement, will each depend on a number of factors, including the market value of our Class A common stock at the time of redemption or exchange, the prevailing federal tax rates applicable to us over the life of the Tax Receivable Agreement (as well as the assumed combined state and local tax rate), the amount and timing of the taxable income that we generate in the future and the extent to which future redemptions, exchanges or purchases of LLC Units are taxable transactions.

Payments under the Tax Receivable Agreement are not conditioned on the Pre-IPO LLC Members’ continued ownership of us. There may be a material negative effect on our liquidity if, as described below, the payments under the Tax Receivable Agreement exceed the actual benefits we receive in respect of the tax attributes subject to the Tax Receivable Agreement and/or distributions to us by Grayscale Operating, LLC are not sufficient to permit us to make payments under the Tax Receivable Agreement.

In addition, the Pre-IPO LLC Members will not reimburse us for any payments previously made if such tax basis increases or other tax benefits are subsequently disallowed by the IRS, except that any excess payments made to the Pre-IPO LLC Members will be netted against future payments otherwise to be made under the Tax Receivable Agreement, if any, after our determination of such excess. As a result, in such circumstances, we could make payments to the Pre-IPO LLC Members under the Tax Receivable Agreement that are greater than our actual cash tax savings and we may not be able to recoup those payments, which could negatively impact our liquidity.

In addition, the Tax Receivable Agreement provides that (1) in the event that we breach any of our material obligations under the Tax Receivable Agreement, (2) upon certain changes of control or (3) if, with the written approval of a majority of our independent directors, we elect an early termination of the Tax Receivable Agreement, our obligations under the Tax Receivable Agreement (with respect to all LLC Units, whether or not LLC Units have been exchanged or acquired before or after such transaction) would accelerate and become payable in a lump sum amount equal to the present value of the anticipated future tax benefits calculated based on certain assumptions, including that we would have sufficient taxable income to fully utilize the deductions arising from the tax deductions, tax basis and other tax attributes subject to the Tax Receivable Agreement. These provisions in the Tax Receivable Agreement may result in situations where the Pre-IPO LLC Members have interests that differ from or are in addition to those of our other stockholders. In addition, we could be required to make payments under the Tax Receivable Agreement that are substantial and in excess of our, or a potential acquirer’s, actual cash savings in income tax. In these situations, our obligations under the Tax Receivable Agreement could have a substantial negative impact on our liquidity and could have the effect of delaying, deferring or preventing certain mergers, asset sales, other forms of business combinations or other changes of control. There can be no assurance that we will be able to fund our obligations under the Tax Receivable Agreement.

Our obligations under the Tax Receivable Agreement will also apply with respect to any person that becomes a party to the Tax Receivable Agreement in the future.

Finally, because we are a holding company with no operations of our own, our ability to make payments under the Tax Receivable Agreement depends on the ability of Grayscale Operating, LLC to make distributions to us. To the extent that we are unable to make payments under the Tax Receivable Agreement for any reason, such payments will be deferred and will accrue interest until paid, which could negatively impact our results of operations and could also affect our liquidity in periods in which such payments are made.

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The market price of our Class A common stock may be volatile or may decline significantly or suddenly regardless of our operating performance. You may not be able to sell your shares at or above the initial public offering price and lose all or part of your investment.

The initial public offering price for our Class A common stock was determined through negotiations between the underwriters and us, and it may vary from the market price of our Class A common stock following this offering. If you purchase shares of our Class A common stock in this offering, then you may not be able to sell those shares at or above the initial public offering price. The market price of our Class A common stock may fluctuate or decline significantly in response to numerous factors, many of which are beyond our control, including, but not limited to:

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the realization of any of the risk factors described herein;

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actual or anticipated fluctuations in our quarterly financial and other results of operations;

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variations between our actual results of operations and the expectations of analysts, investors and the financial community;

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any forward-looking financial or operating information we may provide to the public or analysts, any changes in this information or our failure to meet expectations based on this information;

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actions of analysts who initiate or maintain coverage of us, changes in financial estimates by analysts who follow us or our failure to meet these estimates or the expectations of investors;

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any significant changes in our management or board of directors;

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investors’ or analysts’ views of our stock structure and the significant voting control of DCG;

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additional shares of our Class A common stock being sold into the market by us or DCG, or the anticipation of such sales, including sales to satisfy tax obligations related to equity awards;

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announcements by us or our competitors of significant investment products, acquisitions, strategic partnerships, joint ventures or capital commitments;

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levels of, and investors’ expectations with respect to, interest rates, rates of inflation of fiat currencies or digital assets and rates of return on digital asset trading platforms;

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changes in operating performance and stock market valuations of participants in the digital asset industry, including our competitors;

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increased competition from other asset managers offering digital asset-focused investment products;

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rumors and market speculation involving us or other participants in the digital asset industry;

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fluctuations in the prices and volumes of digital assets, as well as in the stock market generally, including as a result of trends in the economy as a whole;

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investor preferences and sentiment toward digital assets, particularly Bitcoin and Ethereum;

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the adoption of digital assets as a medium of exchange, utility, store of value, consumptive asset, security instrument or other financial asset;

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our failure to continue to innovate and introduce successful new investment products;

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the liquidity of digital asset markets and any increases or decreases in trading volumes on digital asset markets;

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interruptions in service from, or closures or failures of, major digital asset trading platforms;

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forks, airdrops and similar events with respect to digital assets held by one or more of our investment products;

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manipulative trading activity on digital asset trading platforms;

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decreased confidence in the digital asset industry due to the unregulated nature and lack of transparency surrounding the operations of digital asset trading platforms;

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the extent to which retail and other individual investors (as distinguished from institutional investors) invest in our Class A common stock, which may result in increased volatility;

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litigation threatened or filed against us, participants in the digital asset industry or both;

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developments in new legislation or actions or investigations by regulators against us or other participants in the digital assets industry, including with respect to the security status of the digital assets for which we offer investment products;

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failure to comply with the requirements of the stock exchange on which we intend to list our Class A common stock; and

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other events or factors, including those resulting from war or acts of terrorism or responses to these events.

In addition, the stock market in general, and the market for participants in the digital asset industry in particular, has experienced significant price and volume fluctuations that have often been unrelated or disproportionate to their operating performance. In the past, following periods of volatility in the overall market and the market price of a particular company’s securities, class action litigation has often been instituted against that company. Securities litigation, if instituted against us, could result in substantial costs and divert our management’s attention and resources.

The participation of investors in GBTC and ETHE in this offering through the directed share program could result in increased volatility in the market price of our Class A common stock.

Investors in GBTC and ETHE will have the opportunity to participate in this offering through our directed share program discussed elsewhere in this prospectus, which could result in individual investors, retail or otherwise, constituting a larger proportion of the investors participating in this offering than is typical for an initial public offering. These factors could cause volatility in the market price of our Class A common stock. In addition, high levels of initial interest in our Class A common stock at the time of this offering may result in an unsustainable market price, in which case the market price of our Class A common stock may decline over time.

Further, if the market price of our Class A common stock is above the level that investors determine is reasonable for our Class A common stock, some investors may attempt to short our Class A common stock after trading begins, which would create additional downward pressure on the market price of our Class A common stock.

No public market for our Class A common stock currently exists, and an active public trading market may not develop or be sustained following this offering, which could adversely affect the price and liquidity of our Class A common stock.

No public market for our Class A common stock currently exists. An active public trading market for our Class A common stock may not develop following the completion of this offering, or if developed, may not be sustained. The lack of an active market may impair your ability to sell your shares at the time you wish or at a price that you consider reasonable. The lack of an active market may also reduce the fair value of your shares. An inactive market may also impair our ability to raise capital to continue to fund operations by selling shares and may impair our ability to acquire other companies or digital assets by using our shares as consideration.

Future sales of our Class A common stock in the public market could cause the market price of our Class A common stock to decline.

Sales of a substantial number of shares of our Class A common stock, including those issuable upon redemption or exchange of the LLC Units owned by the Pre-IPO LLC Members and those issued upon conversion of the Convertible Preferred Stock, in the public market following the completion of this offering, or the perception that these sales might occur, could depress the market price of our Class A common stock and impair our ability to raise capital through the sale of additional shares. The Pre-IPO LLC Members have substantial unrecognized gains on the value of the equity they hold based upon the price of this offering, and therefore may take steps to redeem or exchange their LLC Units into shares of Class A common stock and sell such shares or otherwise secure the unrecognized gains on those shares. We are unable to predict the timing of or the effect that such sales may have on the prevailing market price of our Class A common stock. All of the Class A common stock sold in this offering will be freely tradable without restrictions or further registration under the Securities Act, except for any shared held by our affiliates as defined in Rule 144. The Class A common stock issuable upon redemption or exchange of the LLC Units held by the Pre-IPO LLC Members will be deemed “restricted securities” as that term is defined under Rule 144 of the Securities Act.

All of our directors, executive officers, DCG and the holders of the Convertible Preferred Stock, who together hold all of our outstanding stock and securities directly or indirectly convertible into or exchangeable or exercisable for our Class A common stock, are subject to lock-up agreements with the underwriters, pursuant to which they have agreed that they will not, and will not publicly disclose an intention to, during the period beginning on the date of this prospectus and continuing through the date that is 180 days after the date of this prospectus (such period, the “Lock-up Period”), offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend or otherwise transfer or dispose of, directly or indirectly, any of our shares of common stock, any options or warrants to purchase any of our shares of common stock or any securities convertible into or exchangeable for or that represent the right to receive shares of our common stock or enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of our common stock, provided that Morgan Stanley & Co. LLC on behalf of the underwriters may release any of the securities subject to these lock-up agreements at any time, subject to the applicable notice requirements.

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In addition, the Lock-up Period may be shortened with respect to a portion of the locked-up securities held by certain lock-up parties, and the lock-up agreements are subject to a number of exceptions. These agreements are further described in the sections titled “Shares Eligible for Future Sale” and “Underwriting.” If not earlier released, then any shares of Class A common stock issued upon exchange or redemption of the LLC Units held by the Pre-IPO LLC Members will become eligible for sale upon expiration of the Lock-up Period, subject to the requirements of Rule 144 or another applicable exemption under the Securities Act or pursuant to an effective registration statement under the Securities Act.

In addition, after giving effect to the IPO Reorganization, there would have been shares of Class A common stock issuable upon the exercise of options and upon the vesting and settlement of restricted stock units outstanding as of . We intend to register all of the shares of Class A common stock issuable upon exercise of outstanding options, the vesting and settlement of outstanding restricted stock units and other equity incentives we may grant in the future for public resale under the Securities Act. The shares of Class A common stock will become eligible for sale in the public market to the extent such options are exercised or restricted stock units vested and settled, subject to the lock-up agreements described above and compliance with applicable securities laws.

Further, the holders of Convertible Preferred Stock and the Pre-IPO LLC Members will have rights, subject to some conditions, to require us to file registration statements covering the sale of their shares of Class A common stock (including any shares of Class A common stock issuable upon exchange or redemption of the LLC Units or issuable upon conversion of the Convertible Preferred Stock) or to include their shares in registration statements that we may file for us or other stockholders.

Sales, short sales or hedging transactions involving our equity securities, whether before or after this offering and whether or not we believe them to be prohibited, could adversely affect the market price of our Class A common stock.

If you purchase shares of our Class A common stock in this offering, then you will incur immediate and substantial dilution.

The initial public offering price is substantially higher than the pro forma net tangible book value per share of our Class A common stock immediately following this offering based on the total value of our tangible assets less our total liabilities. In addition, the shares of Convertible Preferred Stock will automatically convert at the closing of this offering into shares of Class A common stock at a discount to the initial public offering price. Therefore, if you purchase our Class A common stock in this offering at the initial public offering price of $ per share, you will experience an immediate dilution of $ per share, representing the difference between the price per share you pay for our Class A common stock and our pro forma as adjusted net tangible book value per share as of , 2025 of $ , after giving effect to the issuance by us of shares of our Class A common stock in this offering. and the conversion of the 25,000,000 shares of Convertible Preferred Stock into shares of Class A common stock assuming an initial public offering price of $ per share (the midpoint of the estimated price range set forth on the cover page of this prospectus). In addition, you may also experience additional dilution if options, restricted stock units or other rights to purchase our Class A common stock that are outstanding or that we may issue in the future are exercised, vest or are converted or we issue additional shares of our Class A common stock at prices lower than our net tangible book value at such time.

In connection with the Private Placement, we granted the holders of Convertible Preferred Stock the right to receive a “make-whole” payment following the consummation of this offering under certain conditions. Whether we are obligated to pay the make-whole and the size of any such make-whole payment are primarily dependent on the trading price of the shares of our Class A common stock during the Make-Whole Reference Period, which is expected to be the 40 trading days beginning approximately seven months after the closing of this offering, as compared to the initial public offering price of the shares of the Class A common stock sold in this offering. If the volume-weighted average trading price of the shares of our Class A common stock during the Make-Whole Reference Period is less than the initial public offering price of the shares of the Class A common stock sold in this offering, then holders of Convertible Preferred Stock will likely be entitled to a make-whole payment in cash, and such payment may be significant. See “Certain Relationships and Related Person Transactions—Investors’ Rights Agreement.”

If we are required to make a make-whole payment, it could have a material adverse effect on our liquidity, cash flows and overall financial position. Any such payment could limit the funds available for our operations, growth initiatives and other corporate purposes, and could require us to obtain additional financing on unfavorable terms or at times when financing may not be available. The existence of this obligation could also adversely affect investor perception of our financial flexibility and adversely affect the market price of our Class A common stock.

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If securities or industry analysts do not publish research or publish unfavorable or inaccurate research about our business, then the market price and trading volume of our Class A common stock could decline.

The market price and trading volume of our Class A common stock following the completion of this offering will be heavily influenced by the way securities and industry analysts interpret our financial information and other disclosures. We do not have control over these analysts. If few securities analysts commence coverage of us, or if industry analysts cease coverage of us, then our stock price would be negatively affected. If analysts do not publish research or reports about our business, downgrade our Class A common stock or publish negative reports, then our stock price would likely decline. If any of these analysts cease coverage of us or fail to publish reports on us regularly, then demand for our Class A common stock could decrease, which might cause our stock price to decline and decrease the trading volume of our Class A common stock.

We are an “emerging growth company” as defined in the JOBS Act. We will remain an emerging growth company until the earliest of:

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the end of the fiscal year during which we have total annual gross revenue of $1.235 billion (as adjusted for inflation pursuant to SEC rules from time to time) or more;

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the end of the fiscal year following the fifth anniversary of the completion of this offering;

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the date on which we have, during the previous three-year period, issued more than $1.0 billion in non convertible debt; or

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the date on which we are deemed to be a “large accelerated filer” under the Exchange Act.

As a result of our “emerging growth company status,” we may take advantage of exemptions from various reporting requirements that would otherwise be applicable to public companies including, but not limited to, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.

Investors may find our Class A common stock less attractive because we may rely on these exemptions. If some investors find our Class A common stock less attractive as a result, then there may be a less active trading market for our Class A common stock and the market price of our Class A common stock may be adversely affected and more volatile.

We will incur increased costs as a result of operating as a public company, and our management will be required to devote substantial time to compliance with our public company responsibilities and corporate governance practices.

As a public company, we will incur significant legal, accounting and other expenses that we did not incur as a private company, which we expect to further increase after we are no longer an “emerging growth company.” The Sarbanes-Oxley Act, the Dodd-Frank Wall Street Reform and Consumer Protection Act, the listing requirements of the New York Stock Exchange and other applicable securities rules and regulations impose various requirements on public companies. Our management and other personnel will devote a substantial amount of time to compliance with these requirements. Moreover, these rules and regulations will increase our legal and financial compliance costs and make some activities more time-consuming and costly. We cannot predict or estimate the amount of additional costs we will incur as a public company or the specific timing of such costs.

Following the completion of this offering, we will be a “controlled company” as defined under the corporate governance rules of the NYSE, and as a result, will qualify for, and rely on, exemptions from certain corporate governance requirements of the NYSE.

Upon completion of this offering, DCG will continue to own % of the total voting power of our outstanding shares of common stock eligible to vote in the election of our directors (or % if the underwriters exercise in full their option to purchase additional shares of our Class A common stock from us to cover over-allotments). As a result, we will be a “controlled company” as defined under the corporate governance rules of the NYSE, and therefore, will qualify for exemptions from certain corporate governance requirements of the NYSE, including:

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the requirement that our board of directors be composed of a majority of independent directors;

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the requirement that the Nominating and Governance Committee be composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities or, if no such committee exists, that our director nominees be selected or recommended by independent directors constituting a majority of our board of directors’ independent directors in a vote in which only independent directors participate;

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the requirement that the Compensation Committee be composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities; and

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the requirement for an annual performance evaluation of the Nominating and Governance Committee and the Compensation Committee.

We intend to take advantage of certain of these exemptions following the completion of this offering, including the exemption from the requirement to have a majority of independent directors and the exemption from the requirement that each of our Nominating and Governance Committee and Compensation Committee be composed entirely of independent directors, and may take advantage of other exemptions the from time to time in the future. As a result, you will not have the same protections afforded to stockholders of companies that are subject to all of the corporate governance requirements of the NYSE. Investors may find our Class A common stock less attractive because we rely on these exemptions. If some investors find our Class A common stock less attractive as a result, then there may be a less active trading market for our Class A common stock and the market price of our Class A common stock may be adversely affected and more volatile. See “Management—Controlled Company Exemption.”

Following the completion of this offering, DCG will continue to control the direction of our business, and the concentrated ownership of our common stock may prevent you and other stockholders from influencing significant decisions.

Upon completion of this offering, DCG will continue to own % of the total voting power of our outstanding shares of common stock (or % if the underwriters exercise in full their option to purchase additional shares of our Class A common stock from us to cover over-allotments). Investors in this offering generally will not be able to affect the outcome of any matter submitted to our stockholders for approval as long as DCG or its successor-in-interest beneficially owns a majority of the total voting power of our outstanding shares of common stock. As long as DCG or its successor-in-interest beneficially owns a majority of the total voting power of our outstanding shares of common stock, it will generally be able to control, whether directly or indirectly through its ability to remove and elect directors, and subject to applicable law, all matters affecting us without the approval of other stockholders, including:

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determinations with respect to our business direction and policies, including the election and removal of directors and the appointment and removal of officers;

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determinations with respect to corporate transactions, such as mergers, business combinations or dispositions of assets;

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our financing and dividend policies;

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our compensation and benefit programs and other human resources policy decisions;

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termination of, changes to or determinations under our agreements with DCG;

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determinations with respect to tax matters; and

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changes to any other agreements that may adversely affect us.

If DCG does not dispose of its remaining equity interest or purchases shares of our common stock in the open market following the completion of this offering, then it could remain our controlling stockholder for an extended period of time or indefinitely. Even if DCG were to beneficially own less than a majority of the total voting power of our outstanding shares of common stock, it may be able to influence the outcome of corporate actions requiring stockholder approval for as long as it owns a significant portion of our common stock.

DCG’s interests may not be the same as, or may conflict with, the interests of our other stockholders. Actions that DCG takes with respect to us, as a controlling or significant stockholder, may not be favorable to us or our other stockholders.

Our management team has limited experience managing a public company.

Our management team has limited experience managing a public company, interacting with public company investors and complying with the increasingly complex laws pertaining to public companies, and may not successfully or efficiently manage our transition to being a public company subject to significant regulatory oversight and reporting obligations under the federal securities laws and the continuous scrutiny of securities analysts and investors. These new obligations and constituents will require significant attention from our management and could divert their attention from the day-to-day management of our business, which could adversely affect our business, financial condition and results of operations.

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We will be required to indemnify our directors and certain officers or other agents against a wide range of potential liabilities, and these indemnification obligations could be material.

Our organizational documents will provide for customarily broad rights of indemnification for directors and certain officers or other agents, as well as the possibility of advancement of expenses to such indemnified persons. In addition, we have entered into indemnification agreements with our directors and officers. While rights of indemnification are typically viewed as a key protection and inducement for indemnified persons to serve in senior roles in which they may be exposed to liability, indemnification payments and advancement of expenses may be material and may have an adverse effect on us.

Furthermore, indemnified persons may be subject to derivative or other similar claims brought by us or our stockholders, which claims would generally be expected to be covered by rights of indemnification and, potentially, advancement of expenses. In certain circumstances, subject to applicable laws in the relevant jurisdictions, indemnified persons may be entitled to indemnification even if their liabilities arose from their own negligence or unlawful conduct. We have incurred, and are expected to continue to incur, significant expense to procure directors’ and officers’ liability insurance that both supports our potential indemnification obligations, and in some cases, provides indemnified persons with additional protection beyond the scope of these obligations. If we are unable to maintain adequate insurance, then there could be adverse consequences.

Failure to maintain effective internal controls could cause our investors to lose confidence in us and adversely affect the market price of our Class A common stock.

As a public company, we will be subject to the reporting requirements of the Exchange Act, the Sarbanes-Oxley Act, SEC rules and regulations and the listing rules of the NYSE, including the establishment and maintenance of effective disclosure and financial controls, changes in corporate governance practices, and required filing of annual, quarterly, and current reports with respect to our business and results of operations. We expect that the requirements of these rules and regulations will continue to increase our legal, accounting and financial compliance costs, make some activities more difficult, time-consuming and costly and place significant strain on our personnel, systems and resources.

Section 404 of the Sarbanes-Oxley Act of 2002, or Section 404, requires that we maintain internal control over financial reporting that meets applicable standards. We are developing and refining our disclosure controls and other procedures that are designed to ensure that information required to be disclosed by us in the reports that we will file with the SEC is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms and that information required to be disclosed in reports under the Exchange Act is accumulated and communicated to our principal executive and financial officers. We are also continuing to improve our internal control over financial reporting, which includes hiring additional accounting and financial personnel to implement such processes and controls. In order to maintain and improve the effectiveness of our disclosure controls and procedures and internal control over financial reporting, we have expended, and anticipate that we will continue to expend, significant resources, including accounting-related costs, new internal processes and procedures and significant management oversight. We may err in the design or operation of our controls, and all internal control systems, no matter how well designed and operated, can provide only reasonable assurance that the objectives of the control system are met. Because there are inherent limitations in all control systems, there can be no assurance that all control issues have been or will be detected. If we are unable, or are perceived as unable, to produce reliable financial reports due to internal control deficiencies, investors could lose confidence in our reported financial information and operating results, which could result in a negative market reaction and a decrease in our stock price.

Following our initial public offering, we will be required, pursuant to Section 404, to furnish a report by management on, among other things, the effectiveness of our internal control over financial reporting. Such report will not be required until our second annual report filed on Form 10-K. We will need to disclose any material weaknesses identified by our management in our internal control over financial reporting. As an “emerging growth company,” we will avail ourselves of the exemption from the requirement that our independent registered public accounting firm attests to the effectiveness of our internal control over financial reporting under Section 404. However, we may no longer avail ourselves of this exemption when we cease to be an “emerging growth company.” When our independent registered public accounting firm is required to undertake an assessment of our internal control over financial reporting, the cost of our compliance with Section 404 will correspondingly increase. Our compliance with applicable provisions of Section 404 may require that we incur substantial accounting expense and expend significant management time on compliance-related issues as we implement additional corporate governance practices and comply with reporting requirements. Moreover, if we are not able to comply with the requirements of Section 404 applicable to us in a timely manner, or if we or our independent registered public accounting firm identifies deficiencies in our internal control over financial reporting that are deemed to be material weaknesses, the market price of our stock could decline and we could be subject to sanctions or investigations by the SEC or other regulatory authorities, which would require additional financial and management resources.

In connection with the audit of our consolidated financial statements for the fiscal year ended December 31, 2023, we identified a material weakness in our internal controls related to the lack of systemically enforced review of journal entries by the general ledger system. In connection with this prior material weakness, we implemented remediation measures by replacing the prior general ledger system with a new general ledger system that has enhanced systemically enforced review control capabilities as well as by hiring

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additional personnel with experience in the ongoing identification, design and implementation of internal control over financial reporting. This prior material weakness was determined to be fully remediated as of December 31, 2024, and there were no material weaknesses identified in connection with the audit of our consolidated financial statements for the fiscal year ended December 31, 2024.

If we identify new material weaknesses in our internal control over financial reporting, if we are unable to comply with the requirements of Section 404 in a timely manner, if we are unable to assert that our internal control over financial reporting is effective, or if our independent registered public accounting firm is unable to express an opinion as to the effectiveness of our internal control over financial reporting, we may be late with the filing of our periodic reports, investors may lose confidence in the accuracy and completeness of our financial reports and the market price of our Class A common stock could be negatively affected. As a result of such failures, we could also become subject to investigations by the stock exchange on which our securities are listed, the SEC, or other regulatory authorities, and become subject to litigation from investors and stockholders and/or unable to remain listed on the NYSE, which could harm our reputation and financial condition or divert financial and management resources from our core business, and would have a material adverse effect on our business, financial condition and results of operations.

Our certificate of incorporation will provide for an exclusive forum in the Court of Chancery of the State of Delaware for certain disputes between us and our stockholders, and that the federal district courts of the United States will be the exclusive forum for the resolution of any complaint asserting a cause of action under the Securities Act.

Our certificate of incorporation and bylaws will provide that:

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Unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware (or, if such court does not have subject matter jurisdiction thereof, the federal district court for the District of Delaware) will, to the fullest extent permitted by law, be the sole and exclusive forum for: any derivative action or proceeding brought on our behalf; any action asserting a claim for, or based on, a breach of a fiduciary duty owed by any of our current or former directors, officers, other employees, agents or stockholders to us or our stockholders including, without limitation, a claim alleging the aiding and abetting of such a breach of fiduciary duty; any action asserting a claim against us or any of our current or former directors, officers, employees, agents or stockholders arising pursuant to any provision of the DGCL, our certificate of incorporation or bylaws, or as to which the DGCL confers jurisdiction on the Court of Chancery of the State of Delaware; or any action asserting a claim related to or involving us that is governed by the internal affairs doctrine.

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Unless we consent in writing to the selection of an alternative forum, the federal district courts of the United States will, to the fullest extent permitted by law, be the sole and exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act, and the rules and regulations promulgated thereunder, although there is uncertainty as to whether a court would enforce this provision.

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Any person or entity purchasing or otherwise acquiring or holding any interest in shares of our capital stock will be deemed to have notice of and consented to these provisions.

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Failure to enforce the foregoing provisions would cause us irreparable harm, and we will be entitled to equitable relief, including injunctive relief and specific performance, to enforce the foregoing provisions.

Nothing in our certificate of incorporation or bylaws will preclude stockholders that assert claims solely under the Exchange Act from bringing such claims in federal court to the extent that the Exchange Act confers exclusive federal jurisdiction over such claims, subject to applicable law.

The choice of forum provisions may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or any of our current or former directors, officers, other employees, agents or stockholders, which may discourage such claims against us or any of our current or former directors, officers, other employees, agents or stockholders and result in increased costs for investors to bring such a claim. We believe these provisions may benefit us by providing increased consistency in the application of the DGCL and federal securities laws by chancellors and judges, as applicable, particularly experienced in resolving corporate disputes, efficient administration of cases on a more expedited schedule relative to other forums and protection against the burdens of multi-forum litigation. If a court were to find the choice of forum provision contained in our certificate of incorporation or our bylaws to be inapplicable or unenforceable in an action, then we may incur additional costs associated with resolving such action in other jurisdictions, which could adversely affect our business, financial condition and results of operations.

Our certificate of incorporation includes a provision that suspends the voting rights of a stockholder that is “bad actor” (as defined in Rule 506(d) under the Securities Act) to the extent required to limit such stockholder's voting rights to be no more than 19.9% of the total voting power of our common stock.

Our certificate of incorporation has a provision that restricts voting of shares of our common stock by any stockholder that is “bad actor” (as defined in Rule 506(d) under the Securities Act) to the extent required to limit such stockholder's voting rights to be no more than 19.9% of the total voting power of our common stock. This may make it more difficult or discourage an attempt to obtain control

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of us by means of a proxy contest, tender offer, merger or otherwise, and otherwise discourage stockholders and potential transferees or other investors from acquiring large positions in our capital stock, any of which could have the effect of negatively impacting the market price and transferability of our Class A common stock provision.

If and when we enable tokenized Class A common stock, this feature may not be accepted by the market, and because of regulatory uncertainty we may never be in a position to enable onchain trading of tokenized shares, either of which could in turn have an adverse impact on the broader market for our Class A common stock.

We intend to explore permitting the issuance, transfer, and recordkeeping of our Class A common stock in tokenized form on a blockchain to be selected by Grayscale, as the market for tokenized equities develops. See “Description of Capital Stock—Tokenized Class A Common Stock.” There is little precedent for the issuance or trading of tokenized equity securities, and it is therefore difficult to foresee all of the complications that such activity may entail, which could be significant. For example, if the network on which such tokenized Class A common stock trades experiences downtime, congestion, forks, or other technical issues, holders of tokenized Class A common shares may be unable to transfer or validate ownership of their shares. Such events could impair confidence in our securities and adversely affect their value and liquidity. See “—Risk Factors Related to Digital Assets—Digital asset networks, digital assets and the digital asset trading platforms on which these assets are traded are dependent on internet and other blockchain infrastructure and susceptible to system failures, security risks and rapid technological change” and “—Risk Factors Related to Digital Assets—A fork or airdrop could materially adversely affect our results of operations.”

The market for tokenized securities is nascent, and there can be no assurance that a liquid or orderly market for tokenized securities will develop or be sustained. Blockchain-based mechanisms, including decentralized exchanges, may have significantly less liquidity, volume, transparency, or regulatory oversight compared to national securities exchanges, such as Nasdaq. This could fragment liquidity across platforms, impair price discovery, widen bid-ask spreads, and lead to prolonged price discrepancies between tokenized and traditional forms of the same security—especially where arbitrage is limited by operational or regulatory constraints.

The application of U.S. federal securities laws, state corporate law, and other regulatory regimes to trading in tokenized equity is unsettled. This is expected to limit the willingness of traditional brokers, dealers and other intermediaries to facilitate liquidity in the market for tokenized equities, including tokenized Class A common stock, and we cannot be sure when or if the regulatory clarity needed for such liquidity will be achieved. Regulators such as the SEC, FINRA, the CFTC, and state authorities may adopt new rules or guidance that impose burdensome requirements or restrictions on issuers, transfer agents and other market intermediaries or on the use of blockchain technology systems, including automated market-makers (“AMMs”) and other permissionless decentralized exchange mechanisms (“DEXs”), that could make on-chain trading of tokenized equities impractical. Any such developments could also increase our compliance costs, restrict our ability to issue or maintain tokenized shares, make it unlikely that we would enable on-chain trading, or require us to unwind tokenization altogether. In this connection, future regulatory action could cause us to suspend or reverse tokenization, including forcibly converting tokenized shares back into traditional format, which could disrupt investors’ trading strategies.

As a result, investors may be unwilling to purchase or hold tokenized shares, which could limit market acceptance, reduce liquidity, and adversely affect the trading price of our tokenized Class A common stock. This could in turn adversely impact liquidity in, and therefore pricing in, the broader trading market for our Class A common stock, and expose holders to wider spreads and greater volatility. Adverse signaling from the market for tokenized Class A common stock could also adversely affect pricing in the broader trading market for our Class A common stock.

Vulnerabilities inherent in investors’ digital wallets and cybersecurity risks could result in theft or loss of tokenized shares, which could result in uninsured investor losses.

If and when we enable tokenization, shareholders who wish to hold tokenized Class A common stock will be required to hold such tokenized shares in their own digital wallets, an arrangement referred to as self-custody. This means that holders of tokenized shares will be required to safeguard private keys to access and transfer their securities. The set-up and maintenance of a digital wallet, including safeguarding the private keys for the digital wallet, is the sole responsibility of the shareholder, and neither Grayscale, the Digital Transfer Agent (as defined under “Description of Capital Stock—Tokenized Class A Common Stock”), nor any other party will have any responsibility therefor. For example, if a holder loses the seed phrase for their wallet or downloads malicious wallet software, the resulting loss of access could be permanent. Self-custodied tokenized Class A common stock would not benefit from regulatory protections and conveniences specifically afforded to holders whose securities are held on their behalf through regulated financial intermediaries, including obligations imposed on such intermediaries for the safe custody of customer assets, insurance or protection schemes, recordkeeping and tax reporting, and corporate action servicing.

If a holder’s private keys are lost, stolen, or otherwise compromised, the holder may lose access to their tokenized shares permanently. Grayscale and its transfer agents may not be able to restore access, and affected holders may therefore be unable to sell their tokenized shares or exercise their rights as shareholders. See “—Risk Factors Related to Digital Assets—Private keys are often required to access or transfer digital assets held in custody and the loss or misappropriation of such private keys may cause complete loss of the ability to retrieve or transfer such digital assets. If our Custodians are unable to access the private keys and any backups

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thereto, or it experiences a cybersecurity breach, hack or other data loss that would restrict its ability to access any digital asset held in custody, then we could become subject to reputational harm, legal claims, regulatory scrutiny and other losses.” In addition, although we do not intend, at least initially, to enable AMM or DEX trading of tokenized shares, if we enable such functionality in the future, such trading will rely on smart contracts and cryptographic protocols. Undiscovered flaws, programming errors, or malicious attacks involving such contracts and protocols could also result in the theft, loss, or erroneous transfer of tokenized shares. Any of these developments could lead to investor losses that are not covered by Securities Investor Protection Corporation (“SIPC”) protection, which is only available for securities custodied with an SEC-registered broker. Should this occur, it could result in reputational harm and regulatory scrutiny for Grayscale.

Due to the regulatory uncertainty concerning how brokers may interact with tokens, there may be no brokerage tracking your cost basis in tokenized Class A common stock.

The regulatory framework governing broker-dealer activity with respect to digital assets, including tokenized securities, remains uncertain. The SEC has not yet adopted rules or provided definitive guidance clarifying how registered broker-dealers may custody, trade, or otherwise interact with tokens, whether or not such tokens represent securities. As a result, if you hold shares of our Class A common stock in tokenized form, your ownership is not expected to be reflected in a traditional brokerage account, and no broker would be responsible for tracking your cost basis or maintaining customary account records.

This lack of brokerage involvement could make it more difficult for you to determine your taxable gain or loss upon the sale or other disposition of any tokenized shares, may complicate your ability to rely on customary account statements, and could expose you to additional administrative burdens and potential adverse tax consequences. In addition, the absence of clear regulatory requirements increases the risk that the SEC or another regulatory body could impose obligations on Grayscale, intermediaries, or investors that materially affect the liquidity, transferability, or tax treatment of tokenized Class A common stock.

Holders of tokenized Class A common stock may experience settlement delays when selling their shares.

Under Rule 15c6-1 under the Exchange Act, purchases or sales of securities effected through a broker-dealer are generally required to settle within one U.S. business day (T+1), unless the parties to any such transaction expressly agree otherwise. Because there is no established securities settlement infrastructure for tokenized securities in the United States, holders of our tokenized Class A common stock selling their securities through a broker-dealer may not be able to deliver those shares directly to settle regular-way secondary market trades (i.e., trades where the purchaser expects to receive traditional-format securities). Instead, before effecting delivery, selling holders will be required to convert their tokenized shares into traditional-format, non-tokenized Class A common stock. This conversion process involves multiple steps, reliance on third-party intermediaries, and may take additional time beyond the customary one business day (T+1) settlement cycle applicable to equity securities.

As a result, a holder of tokenized Class A common stock selling its shares in the traditional market may experience settlement delays when attempting to sell its shares, which could reduce your ability to trade efficiently, expose you to market risk during the conversion and settlement period, or cause you to incur additional costs. In addition, if you are unable to complete settlement in a timely manner, you could be subject to penalties or claims from your counterparty or intermediaries, and the liquidity and marketability of our tokenized Class A common stock could be materially and adversely affected.

Accordingly, a holder of tokenized Class A common stock who wishes to sell its shares in a transaction through a broker-dealer that will settle in traditional-format Class A common stock (i.e., any transaction other than a transaction between two holders who have each successfully onboarded with the Digital Transfer Agent and intend to trade in tokenized format) may be required, because of the length of time it may take to reformat such tokenized Class A common stock into traditional format (i.e., to de-tokenize), to specify an alternate settlement cycle at the time of any such sale to prevent a failed settlement, with such attendant risks as becoming subject to buy-ins, market loss liability or other penalties for having failed to deliver on time. Any such seller of tokenized Class A common stock should consult their own legal and financial advisors.

See “Description of Capital Stock—Tokenized Class A Common Stock.”

Tokenized Class A common stock, when available, may not be appropriate for all investors.

Because of the need to establish and maintain a digital wallet capable of holding tokens on the blockchain, the risks posed by and consequences of self-custody and the multistep process needed to sell tokenized Class A common stock in a regular-way transaction, in each case as discussed above, tokenized Class A common stock, when available, may not be appropriate for all investors when we introduce this feature. In particular, an investor who does not intend to be a long-term holder of Class A common stock and instead intends to be able to regularly trade their shares, or an investor who is not familiar with, or may be uncomfortable with, the operation of digital wallets on the blockchain, should hold its Class A common stock in traditional format, such as through a traditional brokerage account.

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Special Note Regarding Forward-Looking Statements

We have made statements under the captions “Prospectus Summary,” “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Business” and in other sections of this prospectus that are forward-looking statements. In some cases, you can identify these statements by forward-looking words such as “may,” “might,” “will,” “should,” “could,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential” or “continue,” the negative of these terms and other comparable terminology. These forward-looking statements, which are subject to risks, uncertainties and assumptions about us, may include projections of our future financial performance, our anticipated growth strategies and anticipated trends in our business. These statements are only predictions based on our current expectations and projections about future events. There are important factors that could cause our actual results, level of activity, performance or achievements to differ materially from the results, level of activity, performance or achievements expressed or implied by the forward-looking statements, including those factors discussed under the caption entitled “Risk Factors.” You should specifically consider the numerous risks outlined under “Risk Factors.” These risks and uncertainties include, but are not limited to, factors related to:

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declines in the market prices of digital assets;

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our exposure to investor sentiment toward digital assets and, in particular, Bitcoin and Ethereum;

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our exposure to a concentration of assets in the digital asset class;

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our failure to compete effectively;

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failure of our investment products to achieve their investment objective for the foreseeable future;

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our failure to develop, maintain and enhance our brand and reputation;

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lack of liquidity and market disruptions that disrupt trading or create volatility and undermine investor confidence in our products;

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our inability to develop new investment products, and the introduction of new competing investment products;

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the ineffectiveness of our risk mitigation strategies in mitigating new or existing operational risks;

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actions we may take in managing our Principal Investments;

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our limited operating history and the variability of our operating results;

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our reliance on third-party providers, and our inability to maintain adequate relationships with third-party banking partners;

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the development, public acceptance and adoption of digital assets, including Bitcoin and Ethereum;

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extreme volatility in the prices of digital assets;

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unsuccessful efforts to increase the volume, speed and accessibility of digital asset transactions;

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loss of confidence by customers, counterparties and regulators in the digital asset industry;

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incorrect execution of digital asset transactions, including errors by our employees in the transfer of digital assets;

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uncertainties related to the tax treatment of digital assets;

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regulatory changes or actions in the United States or foreign jurisdictions that lead to restrictions in the use of digital assets or operation of digital asset networks;

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fraud, market manipulation, business or security failures or other problems in the operations of digital asset trading platforms that adversely affect the prices of digital assets;

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the use of digital asset networks to facilitate illicit activities;

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a determination that a digital asset is a security;

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our failure to comply with the extensive government regulations that we are subject to;

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our ability to obtain, maintain, protect, defend or enforce our intellectual property rights;

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our failure to comply with obligations under license agreements, or an inability to license rights on reasonable terms;

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cybersecurity incidents and other issues related to our information systems, technology and data, including interruptions to the operations and integrity of our systems;

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our ability to comply with, and changes to, laws and regulations relating to data privacy and security;

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our dependence on distributions from Grayscale Operating, LLC to fund dividend payments, if any, and our taxes and expenses, including payments under the Tax Receivable Agreement;

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DCG’s control of us and our status as a controlled company;

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our ability to realize any benefit from our organizational structure; and

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the other risk factors described under “Risk Factors.”

Although we believe the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, level of activity, performance or achievements. These statements are based on information available to us as of the date of this prospectus, which may be limited or incomplete. You should not place undue reliance on the forward-looking statements included in this prospectus. We are under no duty to update any of these forward-looking statements after the date of this prospectus to conform our prior statements to actual results or revised expectations.

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ORGANIZATIONAL STRUCTURE

The Pre-IPO Reorganization

On January 1, 2025, we consummated an internal corporate reorganization (the “Pre-IPO Reorganization”) involving the following steps:

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The Pre-IPO Reorganization was treated as a reorganization of companies under common control and has been accounted for as a change in reporting entity between entities under common control, as each entity was controlled by DCG. Accordingly, Grayscale Operating, LLC’s consolidated financial statements included in this prospectus as of and for the years ended December 31, 2024, and 2023 have been presented giving retroactive effect to the Pre-IPO Reorganization in accordance with Accounting Standards Codification (“ASC”) 250-10-45-21.

The Private Placement Reorganization

Grayscale Investments, Inc. (formerly known as GSO Intermediate Holdings I Corporation) was formed as a Delaware corporation on May 2, 2025. On October 22, 2025, we completed the Private Placement of our Convertible Preferred Stock, as described above under “Prospectus Summary—Recent Developments—Private Placement of Convertible Preferred Stock.” Pursuant to a securities purchase agreement, we issued and sold 25,000,000 shares of the Convertible Preferred Stock in the Private Placement for an aggregate purchase price of $250 million.

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GSO Intermediate Holdings I Corporation was renamed to Grayscale Investments, Inc.;

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GSOIH contributed 3,006,000 LLC Units, representing a 3.34% ownership interest in the LLC Units, to Grayscale Investments, Inc. in exchange for an equal number of shares of Class A common stock;

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Grayscale Investments, Inc. entered into a Tax Receivable Agreement that obligates us to make payments ‎to the Pre-IPO LLC Members and any future party to the Tax Receivable Agreement ‎generally equal to 85% of the applicable cash savings

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that we actually realize as a result of ‎certain tax basis adjustments resulting from the purchase of LLC Units from the Pre-IPO LLC ‎Members in connection with or after this offering, future taxable redemptions or exchanges of ‎LLC Units by the holders of LLC Units and from payments made under the Tax Receivable ‎Agreement. We will retain the benefit of the remaining 15% of these tax savings;‎

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The diagram below depicts our organizational structure immediately following the Private Placement Reorganization. This chart is provided for illustrative purposes only and does not purport to represent all legal entities within our organizational structure.

Structure Prior to the IPO Reorganization

Grayscale Investments, Inc. will be the issuer of the Class A common stock offered hereby. We currently conduct our business through Grayscale Operating, LLC and its subsidiaries. All of Grayscale Operating, LLC’s outstanding equity interests are currently owned by the following persons and entities (other than those equity interests owned by us), which we refer to collectively as the “Pre-IPO LLC Members” and which are both controlled by DCG:

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DCG Grayscale Holdco; and

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GSOIH.

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The IPO Reorganization

In connection with this offering, we intend to enter into the following series of transactions to implement an internal reorganization, which we collectively refer to as the “IPO Reorganization”:

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Grayscale Investments, Inc.’s certificate of incorporation will be further amended to increase the aggregate authorized share capital to shares and to make certain other changes. See “Description of Capital Stock”;

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The LLC Agreement of Grayscale Operating, LLC will be further amended and restated (the “Amended LLC Agreement”) prior to this offering. Under the Amended LLC Agreement, all current and future holders of LLC Units, including the Pre-IPO LLC Members, will ‎have the right, from and after the completion of this offering, to require Grayscale Operating, LLC to ‎redeem all or a portion of their LLC Units for, at our election, newly issued shares of Class A ‎common stock on a one-for-one basis or a cash payment equal to the volume-weighted ‎average market price of one share of our Class A common stock for each LLC Unit redeemed ‎‎(subject to customary adjustments, including for stock splits, reverse splits, stock dividends and other similar events affecting the Class A common stock) in accordance with the terms of the Amended LLC Agreement (the ‎‎“Redemption Right”). Additionally, in the event of a redemption request by a holder of LLC ‎Units, we may, at our option, effect a direct exchange of cash or Class A common stock for ‎LLC Units in lieu of such a redemption. A corresponding number of shares of Class B common ‎stock will be canceled on a one-for-one basis if we, following a redemption request of a holder ‎of LLC Units, redeem or exchange LLC Units of such holder of LLC Units pursuant to the ‎terms of the Amended LLC Agreement. See “Certain Relationships and Related Person ‎Transactions—Amended LLC Agreement.” Except for transfers to us pursuant to the ‎Amended LLC Agreement or to certain permitted transferees, the holders of LLC Units are not ‎permitted to sell, transfer or otherwise dispose of any LLC Units or shares of Class B common ‎stock;

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Grayscale Investments, Inc. will issue shares of Class A common stock to the public pursuant to ‎this offering;

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Grayscale Investments, Inc. will use all of its net proceeds from this offering (including net proceeds received if the underwriters exercise their option to purchase additional shares of Class A common stock in full) to acquire LLC units from the Pre-IPO LLC Members (or LLC Units, if the underwriters exercise their option to purchase additional shares of Class A common stock in full), at a purchase price per LLC Unit equal to the initial public offering price of Class A common stock after underwriting discounts and commissions, and an equal number of shares of Class B common stock will be forfeited by the Pre-IPO LLC Members to Grayscale Investments, Inc. and canceled immediately thereafter; and‎

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Effect of the Private Placement Reorganization, the IPO Reorganization and this Offering

The Private Placement Reorganization and the IPO Reorganization are intended to create a holding company that will facilitate public ownership of, and investment in, Grayscale Operating, LLC and is structured in a tax-efficient manner for the Pre-IPO LLC Members. The Pre-IPO LLC Members desire that their investment in Grayscale Operating, LLC maintains its existing tax treatment as a partnership for U.S. federal income tax purposes and, therefore, will continue to hold their ownership interests in Grayscale Operating, LLC until such time in the future as they may elect to cause us to redeem or exchange their LLC Units for a corresponding number of shares of our Class A common stock.

We estimate that the offering expenses (other than the underwriting discounts and ‎commissions) will be approximately $‎ million. See “Use of Proceeds.”‎

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The diagram below depicts our organizational structure immediately following the IPO Reorganization, this offering and the application of the net proceeds from this offering, assuming an ‎initial public offering price of $‎ per share (the midpoint of the estimated initial public offering price ‎range set forth on the cover page of this prospectus) and no exercise of the underwriters’ option to ‎purchase additional shares. This chart is provided for illustrative purposes only and does not purport to ‎represent all legal entities within our organizational structure.

Holding Company Structure and the Tax Receivable Agreement

We are a holding company, and immediately after the consummation of the Private Placement our principal asset is, and after the IPO Reorganization and this offering will be, our ownership interests in Grayscale Operating, LLC. The number of LLC Units that we will own directly in the aggregate at any time will equal ‎the aggregate number of outstanding shares of our Class A common stock. The economic interest ‎represented by each LLC Unit that we own directly will correspond to one share of our Class A ‎common stock, and the total number of LLC Units owned directly by us and the holders of our Class B ‎common stock at any given time will equal the sum of the outstanding shares of all classes of our ‎common stock.‎

We do not intend to list our Class B common stock on any stock exchange.‎

Acquisitions by Grayscale Investments, Inc. of LLC Units from the Pre-IPO LLC Members in connection with ‎this offering and future taxable redemptions or exchanges by the Pre-IPO LLC Members of LLC ‎Units for shares of our Class A common stock or cash are expected to produce tax basis adjustments to the ‎assets of Grayscale Operating, LLC that will be allocated to us and thus produce favorable tax ‎attributes. These tax attributes would not be available to us in the absence of those transactions.‎

We have entered into the Tax Receivable Agreement with the Pre-IPO LLC Members that will ‎provide for the payment by us to the Pre-IPO LLC Members of 85% of the amount of cash savings, ‎if any, in U.S. federal, state and local income tax or franchise tax that we actually realize as a result ‎of ‎(i)‎ any increase in tax ‎basis in Grayscale Operating, LLC’s assets resulting from (a) acquisitions by Grayscale Investments, Inc. of LLC ‎Units from the Pre-IPO LLC Members in connection with this offering, (b) the acquisition of LLC Units ‎from the Pre-IPO LLC Members using the net proceeds from any future offering, (c) future taxable ‎redemptions or exchanges by the Pre-IPO LLC Members of LLC Units for shares of our Class A ‎common stock or cash or (d) payments under the Tax Receivable Agreement and (ii) tax benefits ‎related to imputed interest resulting from payments made under the Tax Receivable Agreement. ‎Payments under the Tax Receivable Agreement will be based on the tax reporting positions we ‎determine, and the IRS or another tax authority may challenge all or part of the deductions, tax basis increases or other tax attributes subject to the Tax Receivable Agreement, and a ‎court could sustain such challenge. Although we are not aware of any issue that would cause the IRS ‎to challenge the tax basis

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increases or other benefits arising under the Tax ‎Receivable Agreement, the Pre-IPO LLC Members will not reimburse us for any payments previously ‎made if such basis increases or other benefits are subsequently disallowed, except that excess ‎payments made to the Pre-IPO LLC Members will be netted against future payments otherwise to be ‎made under the Tax Receivable Agreement, if any, after our determination of such excess. Also, the actual state or local tax savings we may realize may be different than the amount of such tax savings we are deemed to realize under the Tax Receivable Agreement, which will be based on an assumed combined state and local tax rate applied to our reduction in taxable income as determined for U.S. federal income tax purposes as a result of the tax attributes subject to the Tax Receivable Agreement. As a ‎result, in such circumstances we could make future payments to the Pre-IPO LLC Members under the ‎Tax Receivable Agreement that are greater than our actual cash tax savings and may not be able to ‎recoup those payments, which could negatively impact our liquidity.

Our obligations under the Tax Receivable Agreement will also apply with respect to any person that becomes a party to the Tax Receivable Agreement in the future.

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USE OF PROCEEDS

We estimate that the net proceeds to us from this offering will be approximately $ million, or approximately $ million if the underwriters exercise their option to purchase additional shares in full, assuming an initial public offering price of $ per share (the midpoint of the range set forth on the cover page of this prospectus), after deducting estimated underwriting discounts and commissions and estimated offering expenses.

Each $1.00 increase or decrease in the assumed initial public offering price of $ per share, which is the midpoint of the estimated offering price range set forth on the cover page of this prospectus, would increase or decrease, as applicable, the net proceeds to us from this offering by approximately $ million, assuming the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same and after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us. We may also increase or decrease the number of shares we are offering. Each increase or decrease of 1.0 million shares in the number of shares offered by us would increase or decrease, as applicable, the net proceeds to us from this offering by approximately $ million, assuming that the assumed initial public offering price remains the same and after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us.

We will use all of the net proceeds from this offering (including net proceeds received if ‎the underwriters exercise their option to purchase additional shares of Class A common stock) ‎to acquire LLC Units from the Pre-IPO LLC Members at a purchase price per LLC Unit equal to the initial public offering price ‎of Class A common stock after underwriting discounts and commissions.‎

Grayscale Operating, LLC will not receive any proceeds from the purchase of LLC Units from the Pre-IPO LLC Members by us.

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Dividend Policy

Any determination to pay dividends on our Class A common stock will be at the discretion of our board of directors, subject to applicable laws, and will depend on our financial condition, results of operations, capital requirements, general business conditions and other factors that our board of directors considers relevant. Moreover, our ability to pay dividends, if and when our board of directors determines to do so, may be restricted by regulatory limits under applicable laws.

Grayscale Investments, Inc. will be a holding company and will have no material assets other than its ownership of LLC Units in Grayscale Operating, LLC, and as a consequence, our ability to declare and pay dividends to the holders of our Class A common stock will be subject to the ability of Grayscale Operating, LLC to provide distributions to us. If Grayscale Operating, LLC makes such distributions, the holders of LLC Units will be entitled to receive equivalent distributions from Grayscale Operating, LLC. However, because we must pay taxes, make payments under the Tax Receivable Agreement and pay our expenses, amounts ultimately distributed as dividends to holders of our Class A common stock are expected to be less than the amounts distributed by Grayscale Operating, LLC to the Pre-IPO LLC Members on a per share basis. See “Certain Relationships and Related Person transactions—Tax Receivable Agreement.”

Assuming Grayscale Operating, LLC makes distributions to its members in any given year, the determination to pay dividends, if any, to our Class A common stockholders out of the portion, if any, of such distributions remaining after our payment of taxes, Tax Receivable Agreement payments and expenses (any such portion, an “excess distribution”) will be made by our board of directors. Because our board of directors may determine to pay or not pay dividends to our Class A common stockholders, our Class A common stockholders may not necessarily receive dividend distributions relating to excess distributions, even if Grayscale Operating, LLC makes such distributions to us.

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Capitalization

The following table sets forth our consolidated cash and cash equivalents and capitalization as of September 30, 2025:

•

on an actual basis for Grayscale Operating, LLC;

•

on a pro forma basis for Grayscale Investments, Inc., giving effect to the Private Placement and the Private Placement Reorganization; and

•

on a pro forma as adjusted basis for Grayscale Investments, Inc., giving further effect to the IPO Reorganization, which includes the conversion of Convertible Preferred Stock into shares of Class A common stock (assuming an initial public offering price of $ per share, which is the midpoint of the estimated price range set forth on the cover page of this prospectus), and other ‎matters described under “Unaudited Pro Forma Condensed Consolidated Financial Information” as prepared in ‎conformity with Article 11 of Regulation S-X, which ‎includes application of the proceeds from this offering as described in “Use of Proceeds” ‎based upon an assumed initial public offering price of $‎ per share (the midpoint of the range ‎set forth on the cover page of this prospectus).

The information set forth in the table below is illustrative only and our capitalization following this offering will be adjusted based on the actual initial public offering price and other terms of this offering determined at pricing. This table should be read in conjunction with the other information contained in this prospectus, including “Organizational Structure,” “Use of Proceeds,” ‎‎“Unaudited Pro Forma Condensed Consolidated Financial Information,” “Management’s Discussion and Analysis of ‎Financial Condition and Results of Operations,” “Description of Capital Stock” and the ‎consolidated financial statements of Grayscale Operating, LLC and subsidiaries and related notes ‎thereto included elsewhere in this prospectus.


	September 30, 2025
(in thousands, except share information)	Actual Grayscale Operating, LLC		Pro Forma Grayscale Investments, Inc.		Pro Forma, as adjusted Grayscale Investments, Inc. (1)
Cash and cash equivalents(2)	$	99,959	$	98,808	$	—
Digital assets and investments in digital asset trusts and funds(3)		—		252,450		—
Member’s equity/Stockholders’ equity:
Series A convertible preferred stock (temporary equity)(4)		—		229,707		—
Member’s equity		101,175		—		—
Class A common stock, $0.0001 par value per share, no shares authorized, no shares outstanding, actual; 3,006,000 shares issued and outstanding, pro forma; and shares issued and outstanding, pro forma as adjusted		—		—
Class B common stock, $0.0001 par value per share, no shares authorized, no shares outstanding, actual; 86,994,000 shares issued and outstanding, pro forma; and shares issued and outstanding, pro forma as adjusted		—		9
Additional paid in capital		—		5,046
Retained earnings		—		—
Noncontrolling interest(5)		—		96,683
Total member’s/stockholders’ equity		101,175		331,445
Total capitalization	$	101,175	$	331,445	$	—

(1)

A $1.00 increase or decrease in the assumed initial public offering price of $‎ per share ‎‎(which is the midpoint of the price range set forth on the cover page of this prospectus) would increase ‎or decrease total stockholder’s equity and total capitalization on a ‎pro forma basis by approximately $‎ million, assuming the number of shares of Class A ‎common stock offered, as set forth on the cover page of this prospectus, remains the same, and after ‎deducting the estimated underwriting discounts and commissions and estimated offering expenses ‎payable by us. Each 1,000,000 increase or decrease in the number of shares of Class A common ‎stock offered in this offering would increase or decrease total ‎stockholder’s equity and total capitalization on a pro forma basis by approximately $‎ million, ‎based on an assumed initial public offering price of $‎ per share, which is the midpoint of the ‎estimated public offering price range set forth on the cover page of this prospectus, and after ‎deducting the estimated underwriting discounts and commissions and estimated offering expenses ‎payable by us.

(2)

‎We will use all of the net proceeds from this offering (including net proceeds received if the underwriters exercise their option to purchase additional shares of Class A common stock) to acquire LLC Units from the Pre-IPO LLC Members at a purchase price per LLC Unit

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equal to the initial public offering price of Class A common stock after underwriting discounts and commissions. Grayscale Operating, LLC will not receive any proceeds from the purchase of LLC Units from the Pre-IPO LLC Members by us.‎

(3)

Assumes 65% of the net proceeds from the Private Placement will be used to invest in digital assets directly and 35% will be used to invest in our digital asset trusts and funds as part of our Principal Investments. See note 2A of the “Unaudited Pro Forma Condensed Consolidated Financial Information and Other Data” included elsewhere in this prospectus for more information.

(4)

Represents the Series A Convertible Preferred Stock issued pursuant to the Private Placement which will automatically convert into shares of Class A common stock upon completion of this offering.

(5)

On a pro forma basis, includes the Grayscale Operating, LLC interests not owned by us, ‎which represents approximately ‎% of Grayscale Operating, LLC’s LLC Units after completion of this offering. Certain Pre-IPO LLC Members will hold the non-controlling economic interests in Grayscale Operating, LLC. Grayscale Investments, Inc. ‎will hold approximately ‎% of the economic interest in Grayscale Operating, LLC after the completion of this offering.

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Unaudited Pro Forma Condensed Consolidated Financial Information

The unaudited pro forma condensed consolidated statement of financial condition as of September 30, 2025, and the ‎unaudited pro forma condensed consolidated statements of operations for the nine months ended September 30, 2025, and the fiscal year ended December 31, 2024, present our consolidated financial position and results of operations after giving effect to the following pro ‎forma transactions (the “Pro Forma Transactions”):‎

•

the Private Placement, as described and defined under “Prospectus Summary—Recent Developments—Private Placement of Convertible Preferred Stock”;

•

the Private Placement Reorganization, as described and defined under “Organizational Structure—Private Placement Reorganization”; and

•

the IPO Reorganization, as described and defined under “Organizational Structure—IPO Reorganization,” including the conversion of all outstanding Convertible Preferred Stock into shares of our Class A common stock, assuming an initial public offering price of $ per share (the midpoint of the price range listed on the cover page ‎of this prospectus), the sale of shares of our Class A common stock pursuant to this ‎offering and the application of the proceeds from this offering as described in “Use of Proceeds,” assuming an initial public offering price of $ per share (the midpoint of the price range listed on the cover page ‎of this prospectus), after deducting underwriting discounts and commissions but before ‎deducting estimated offering expenses.

The following unaudited pro forma condensed consolidated financial information has been derived from, and should be read in conjunction with, Grayscale Investments, Inc.’s (formerly known as GSO Intermediate Holdings I Corporation) and Grayscale Operating, LLC’s audited consolidated financial statements and unaudited interim consolidated financial statements included elsewhere in this prospectus. The unaudited pro forma condensed consolidated statement of financial condition as of September 30, 2025, gives effect to the Pro Forma Transactions as if the Pro Forma Transactions occurred on September 30, 2025. The unaudited pro forma condensed consolidated statements of operations for nine months ended September 30, 2025, and fiscal year ended December 31, 2024 give effect to the Pro Forma Transactions as if the Pro Forma ‎Transactions occurred on January 1, 2024.‎

The presentation of the unaudited pro forma condensed consolidated financial information is prepared in ‎conformity with Article 11 of Regulation S-X using the ‎assumptions set forth in the notes to the unaudited pro forma condensed consolidated financial information.‎

For purposes of the unaudited pro forma condensed consolidated financial information, we have assumed ‎that we will issue shares of Class A common stock at a price per share of $‎ ‎(which is the ‎midpoint of the estimated public offering price range set forth on the cover of this prospectus), and, ‎as a result, immediately following the completion of this offering, the ownership percentage ‎represented by LLC Units not held by us will be ‎%, and the net ‎income attributable to LLC Units not held by us will accordingly represent ‎% of our net ‎income. Except as otherwise indicated, the unaudited pro forma condensed consolidated financial information ‎pres

SUBJECT TO COMPLETION, DATED NOVEMBER 13, 2025

PRELIMINARY PROSPECTUS

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BASIS OF PRESENTATION

MARKET AND INDUSTRY DATA

TRADEMARKS AND TRADE NAMES

NON-GAAP FINANCIAL MEASURES

Prospectus Summary

Grayscale Overview

Our Market Opportunity

Our Growth Opportunities

Competitive Differentiators of Our Platform

Summary Risk Factors

The Pre-IPO Reorganization

Recent Developments

Private Placement of Convertible Preferred Stock

Organizational Structure

Implications of Being an Emerging Growth Company

Digital Currency Group

Corporate Information

The Offering

Summary Consolidated Financial and Other Data

Risk Factors

Risk Factors Related to Our Business

Risk Factors Related to Digital Assets

Risk Factors Related to Regulation, Litigation, Intellectual Property, Cybersecurity and Data Privacy

Risk Factors Related to Our Organizational Structure

Risk Factors Related to Ownership of Our Class A Common Stock and This Offering

Special Note Regarding Forward-Looking Statements

ORGANIZATIONAL STRUCTURE

The Pre-IPO Reorganization

The Private Placement Reorganization

Structure Prior to the IPO Reorganization

The IPO Reorganization

Holding Company Structure and the Tax Receivable Agreement

USE OF PROCEEDS

Dividend Policy

Capitalization

Unaudited Pro Forma Condensed Consolidated Financial Information

Grayscale Investments, Inc. S-1