Cardano Gains Momentum as Grayscale Bets Big on ADA Amid Institutional Adoption

Cardano (ADA) seems to be attracting interest from institutional investors after a stellar performance in 2024. Despite the slight pullback seen across the broader crypto market this year, Grayscale, the world’s largest digital asset manager, is increasing its exposure to ADA. 

In an update regarding its Smart Contract Platform Ex-Ethereum Fund, the digital asset manager noted that Cardano comprised 20% of the fund. ADA is now the second-largest asset in this fund after Solana (SOL).

The Grayscale Smart Contract Platform Ex-Ethereum Fund offers investors indirect exposure to the native tokens of promising smart contract platforms. Following the rebalancing of this fund, investors who buy the product will have indirect access to ADA. 

The rebalancing could suggest rising demand for the token. Moreover, as ZyCrypto earlier reported, the Cardano blockchain is set to undergo a series of upgrades this year, which could also drive value. 

Nevertheless, Grayscale is not the only institutional platform seeking to boost ADA’s presence in the traditional financial market. 

Cardano Joins Hashdex Nasdaq Crypto ETF

Besides Grayscale, Hashdex is also betting on Cardano. This is after the asset manager added ADA to its Nasdaq Crypto ETF, giving institutional investors a chance to invest in the asset. 

The Hashdex Nasdaq Crypto ETF has $651M in net assets, and besides Cardano, it also includes Bitcoin (BTC) and Ethereum (ETH). Cardano has a weighting of 1.67%, making it the fifth-largest asset in the fund.

The attention that Cardano is receiving from institutional investors could help drive value for the asset. Moreover, these products could also drive demand for issuers to seek approval for a Cardano spot exchange-traded fund (ETF) in the near term. 

Will a Cardano ETF Launch in 2025?

The crypto industry is abuzz with speculation over whether the incoming leadership change at the US Securities and Exchange Commission (SEC) will accelerate the approval of more crypto ETFs after Bitcoin and Ethereum.

However, despite the optimism, most traders on Polymarket do not believe that a spot Cardano ETF will be approved this year. Only 25% of traders on Polymarket bet that a spot Cardano ETF will receive approval in 2025.

It is important to note that the SEC mentioned Cardano as a security in its lawsuits against the Binance and Coinbase exchanges. Therefore, for a spot Cardano ETF to get approval, the regulator’s enforcement division must dismiss the claims that the token is a security.