![suit.jpg](https://cdn.steemitimages.com/DQmVZ83rwSqyc4nZC6Bmq1FWRTpR1pLSDjLnRQMsvfNXsx6/suit.jpg)
The crypto is so broken that there is no promise anymore.

Where is SBF sex tape?


![1.PNG](https://cdn.steemitimages.com/DQmQzCErGt2hrSLRAgRxWPtLh5vdgp5AVTskbW9HHjxrSGn/1.PNG)

https://twitter.com/0xMubeen/status/1593713399984230400

Grayscale announced their funds were okay and due to security concerns, they would not share cold wallet addresses.


![2.PNG](https://cdn.steemitimages.com/DQmPWLmUZdtiJ4VBezpihWfsHoL8Pus1v6XPfS1brFDHC9F/2.PNG)

https://twitter.com/Grayscale/status/1593737708723118080

Of course, this sounds too alarming.

FTX announced that everything was okay until eight days later with the bankruptcy filing.

But I think Grayscale has a very sophisticated fund structure and PR to handle this potential bank run.

Whether or not I agree with them is another story, but the way they handled this situation is a very nice lesson for crypto firms.

The fact is that Grayscale got bad impact on the recent bankruptcy through 3AC then FTX.


![3.PNG](https://cdn.steemitimages.com/DQmbNT9bHWxSJGe18WdW6PXRnc3qKiVZsaPh8gTvJu8EkUT/3.PNG)

https://twitter.com/contagionOG/status/1593785225158574084

Those were major blows and probably pretty bad on their balance sheet.

It reflected on their fund's valuation:


![4.PNG](https://cdn.steemitimages.com/DQmPrg5au4xJA7CVWMDyjiQhCXVp2ut3NgjiDhXfMt2cXZN/4.PNG)

https://twitter.com/DeeKnig67666008/status/1593786092897337345

But, their fund structure is very sophisticated.


![5.PNG](https://cdn.steemitimages.com/DQmRkLLuoszid8YZr7T5jmnYwqDxniV3DtPkjXwonEqYY77/5.PNG)

https://twitter.com/DeepSpaceSimian/status/1593764364024270848

They structure the fund like closed-end fund (CEF)!

So long story short, here is why CEF is so smart for crypto investment!

1 - they do not need to face reinvestment 
2- they do not need to hold excess cash to meet redemptions
3 - it is a stable capital base

Unlike other crypto investments that people think should be redeemed with the same amount of crypto, CEF does not need to!

This type of investment is for high-leverage purposes to invest in liquidity assets.

Whether or not Grayscale funds are fully backed by Coinbase vault does not matter to investors.

[CEF](https://www.fidelity.com/learning-center/investment-products/closed-end-funds/what-are-closed-end-funds) loses only because:

1. Distributions to shareholders
2. Poor investment decisions
3. A tender offer to repurchase shares, which is a method to control discounts
4. For leveraged funds only, forced sales to remain in compliance of leverage limits
5. The liquidation of the fund


Suppose my suspicion of their investment strategy is correct. In that case, Grayscale is a very sophisticated investment fund and will likely survive in the current environment as long as there are investors to purchase funds.



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