A Cayman Islands–organized digital asset fund, primarily concentrated in Bitcoin and Ethereum, that issues redeemable Shares, is managed by a Manager, and relies on third‑party service providers and Authorized Participants to provide trading liquidity.

# The Fund

## Business model and structure
- Organized as a Cayman Islands limited liability company operating as a Fund and managed by a Manager on the Fund’s behalf.
- Issues Shares to investors and uses Authorized Participants and a Liquidity Engagement framework (the “Liquidity Provider” arrangements) to facilitate trading and liquidity.
- Holds Digital Asset Components, with a high concentration in Bitcoin and Ethereum (Ether), and Bitcoin as the primary concentration.
- Trades and interacts with Digital Asset Markets and a Digital Asset Trading Platform Market, potentially alongside NYSE Arca; non‑concurrent trading hours can cause price differences relative to NAV.
- The Fund is not permitted to engage in staking.

## Assets and components
- Investments focus on Digital Asset Networks and related components, where forks or clones can affect value.
- The value of the Shares is tied to the performance of these Digital Asset Components, which are subject to volatile market conditions, limited regulatory oversight in some venues, and evolving technology and governance frameworks.

## Operations and governance
- Relies on third‑party service providers for essential functions such as safekeeping of assets; replacing these providers could create operational challenges.
- The Fund’s ability to create or redeem Shares in‑kind may be limited, which can affect liquidity and pricing dynamics.
- Shareholder rights and the Fund’s regulatory treatment may differ because it is organized under Cayman Islands law, which can affect governance and available remedies.

## Market and asset risks
- Digital assets can experience extreme price volatility and have a limited historical track record, which may produce substantial losses.
- Market infrastructure varies in regulatory oversight and transparency, exposing the Fund to risks including fraud, manipulation, security failures, and operational problems.
- Index prices and market events affecting Digital Asset Markets may adversely impact the value of the Fund Components.

## Regulatory and compliance risks
- Changes in U.S. or foreign laws and regulations could restrict or prohibit use of certain Fund Components or the operation of their networks, or could increase the cost and time required to comply.
- If regulators classify the Fund or its participants (for example, Authorized Participants or the Manager) as money services businesses, that classification could impose significant costs and affect liquidity.
- The Fund may be treated as a passive foreign investment company (PFIC) for U.S. tax purposes, which has tax consequences for investors.

## Conflicts of interest and fiduciary considerations
- Potential conflicts of interest may arise between the Manager or its affiliates and the Fund; the Manager’s fiduciary duties are defined by the LLC Agreement.
- The Custodian serves as a fiduciary for the Fund’s assets; the Custodian’s resignation or removal without a replacement could trigger early termination of the Fund.

## Regulatory jurisdiction
- The Fund’s Cayman Islands structure means shareholder rights and remedies may differ from those available under U.S. law.

The Fund is a Cayman Islands-based private fund designed to hold top digital assets, primarily targeting accredited investors, with a focus on tracking the CoinDesk Large Cap Select Index.

# Grayscale Digital Large Cap Fund

## Business structure
The Fund is a Cayman Islands limited liability company established on January 25, 2018. It operates as a private fund under the Cayman Islands Private Funds Act and is subject to regulatory supervision by the Cayman Islands Monetary Authority.

## Purpose
The Fund is designed to hold top digital assets by market capitalization that meet specific criteria. It issues Shares representing equal, fractional undivided interests in the profits, losses, distributions, capital, and assets of the Fund.

## Share issuance
- Shares are issued only in whole Baskets, with one Basket equaling 100 Shares.  
- The Fund primarily issues Shares to accredited investors as defined under Rule 501(a) of Regulation D under the Securities Act of 1933. Shares are also traded on OTC Markets Group Inc.’s OTCQX® under the ticker symbol GDLC.  
- Shares issued in private placements are restricted securities, may not be resold without prior approval from the Manager, and must adhere to Rule 144.

## Fund components
As of June 30, 2024, the digital assets comprising the Fund components are:
- Bitcoin (BTC)  
- Ether (ETH)  
- Solana (SOL)  
- XRP  
- Avalanche (AVAX)

The Fund aims to track the performance of the CoinDesk Large Cap Select Index (DLCS), which consists of 5 to 10 large-cap digital assets.

## Customers and employees
- Customers: The Fund primarily targets accredited investors seeking exposure to digital assets.  
- Management: The Fund is managed by Grayscale Investments, LLC.

## Financial metrics
- Investment objective: The Fund’s objective is for the value of Shares (based on NAV per Share) to reflect the value of the digital assets it holds, after expenses and liabilities.  
- Revenue and fees: The Fund generates income through fees associated with asset management and investments in digital assets. Manager fees are currently set at an annual rate of 2.5% of NAV. Operational costs and capital gains from asset appreciation affect overall profitability.

## Key operations
- The Fund does not currently offer a redemption program; the Manager may consider implementing one in the future, subject to regulatory approvals.  
- Operational activities include holding digital assets in cold storage, working with authorized participants for creation and deployment of Shares, evaluating digital assets, and determining daily NAV.

## Future directions
The Fund is pursuing a potential listing on NYSE Arca, subject to approval by the U.S. Securities and Exchange Commission. The Manager may also pursue a redemption program if regulatory conditions permit.

## Risk factors
The Fund faces risks including regulatory developments, market volatility, and legal outcomes that affect digital asset classifications. The U.S. Securities and Exchange Commission’s view that certain digital assets may be securities can influence valuation and operations.

Grayscale CoinDesk Crypto 5 ETF

10-K / September 3, 2026

10-K / September 6, 2024

10-K / September 3, 2026

The Fund

Business model and structure

Assets and components

Operations and governance

Market and asset risks

Regulatory and compliance risks

Conflicts of interest and fiduciary considerations

Regulatory jurisdiction