Grayscale Investments launched its newest crypto product today: the Grayscale Dogecoin Trust. It’s a major step for the token that started as a joke and ended up in Wall Street’s crosshairs.
According to the company’s press release, the trust is designed to give big-money investors exposure to DOGE without touching the token directly, and Grayscale is already planning to flip it into an exchange-traded fund (ETF) once the SEC goes officially pro-crypto after the confirmation of SEC chair nominee Paul Atkins in February.
The trust officially launched today and is open to accredited investors who meet the financial requirements under U.S. law.
Originally forked from Litecoin (which itself came from Bitcoin), DOGE is now the largest meme coin in the world, and a favorite for the richest man on earth, the controversial Mr. Elon Musk.
Grayscale’s Head of Product & Research, Rayhaneh Sharif-Askary, is calling it more than just a meme coin. “Dogecoin has matured into a potentially powerful tool for promoting financial accessibility. We believe, as a faster, cheaper, and more scalable derivative of Bitcoin, Dogecoin is helping groups underserved by legacy financial infrastructure to participate in the financial system,” she said.
According to Sharif-Askary, the Dogecoin Trust is speculative and illiquid, meaning investors can’t just cash out whenever they want. Shares could trade at massive discounts or premiums compared to the underlying value of the Dogecoin it holds. Grayscale knows this and so it warned investors upfront in the press release.
Grayscale plans to push for the trust’s shares to be listed on secondary markets and eventually convert them into an ETF. But there’s no guarantee that will happen. The SEC has been blocking its crypto ETFs for years. Even Grayscale’s attempt to turn its flagship Bitcoin Trust into an ETF is still stuck in limbo, so you can see why it’s skeptical.
Private placement securities come with all sorts of legal restrictions too. They’re limited to accredited investors—those with high incomes or a net worth over $1 million (excluding their primary home). Most retail investors won’t be able to touch this product directly, though they could eventually buy shares if the trust makes it to the OTC markets. But even then, liquidity could be an issue.
Meanwhile, January’s options expiry event passed with decreased volatility after a week of relatively stagnant Bitcoin (BTC) prices. The options expiry event reflected the underwhelming performance of the market after Donald Trump’s inauguration.
The combined weekly and monthly options expiry event for Bitcoin (BTC) set up expectations for a volatile week but ended with a relatively subdued price. Friday’s event led to the expiry of 80,000 BTC options with a maximum pain at $98,000. However, the options target price did not lead to market manipulation or more significant price swings under $100,000.
A total of $8.38B BTC options had their expiry on Friday, with $1.96B for Ethereum (ETH). The monthly event follows weeks of high expectations, especially following Donald Trump’s inauguration.
The hopes for a clearer crypto message did not materialize, as Trump remained relatively cautious about BTC adoption as a reserve asset.
The first month of 2025 was more subdued, with a small relative gain for BTC and a net loss for ETH. The effect of Donald Trump’s election and expected policies has swayed BTC for three months already, slowing down when it came to the week of options expiry.
January’s event is relatively subdued following December’s combined monthly, quarterly, and yearly expiry. The market now sets its sights on the March buildup of options for the first quarterly expiry of 2025.
Attention shifts to the March options, which have a notional value of $10.43B.
BTC is now building up call options, starting at $110,000 and with the greatest accumulation at $120,000.
BTC heads for the month’s close with a net gain of 11.65%. ETH slid back by a net 2.65%, with worsening sentiment.
The Bitcoin volatility index remains relatively low at 1.89%, moving up slightly in the past week. This week’s expiry is the largest for January on Deribit and came with multiple warnings for price action ahead of the event.
After the options expiry, BTC traded at $104,087, with a small daily loss and a dominance of 55.9%. Trading volumes were subdued at $36B, down 50% from some of the most notable price moves for the past month.
Despite the relatively slow trading, trader behavior points to ‘greed’, as the Fear and Greed Index remained close to 76 points.
After the recent shakedown events, BTC leveraged traders rebuilt their positions. Following the options expiry, BTC will face volatility pressure from the potential to attack short and long leveraged trades.
The most immediate price position is at $103,768.71, with more than $39M in liquidity. Some of the most liquid short positions are between $106,000 and $107,000, allowing for a rapid price hike to that level.
BTC open interest stabilized around $30B on top centralized exchanges, with 55% against 44% long to short positions. As BTC stabilized above $100,000, the sideways movement may return, broken up with moves toward price levels where liquidations are possible.
At the same time, spot buyers continue to accumulate, with a shift between older whales and new accumulation. BTC shifts to wallets with an accumulation of $1,000, while nearly 75% of all BTC wallets contain ‘dust’ amounts of BTC.
Despite the short-term subdued trading, BTC remains more resilient compared to ETH and altcoins. The coming month extends the expectations of a traditionally strong Q1, with bullish expectations of $120,000.
The lack of clear direction, however, is creating a slight bearish sentiment for both retail traders and smart money. Traders remain cautious, as the coming months are expected to deliver the peak of the bull market, with the potential for a reversal.