Grayscale Investments has filed an S-1 registration statement with the Securities and Exchange Commission for a spot Worldcoin (WLD) exchange-traded fund, marking the asset manager’s first foray into the controversial iris-scanning token and its latest push to expand beyond Bitcoin and Ether products.
The filing, submitted late Monday, proposes the Grayscale Worldcoin Trust as a Delaware statutory trust that would hold WLD tokens directly. Coinbase Custody Trust Company would serve as custodian, while BNY Mellon would act as transfer agent and administrator. The fund would trade on NYSE Arca under a ticker to be determined, with Grayscale charging its standard management fee — likely in the 1.5% to 2.5% range based on its existing single-asset trusts.
Worldcoin, co-founded by OpenAI CEO Sam Altman, distributes its WLD token to users who verify their identity through an iris-scanning device called the Orb. The project has drawn scrutiny from privacy regulators in Kenya, France, Germany, and Argentina over biometric data collection practices. Several jurisdictions have suspended or banned Worldcoin’s operations pending investigations. The token has traded between $1.50 and $4.50 since its July 2023 launch, with a fully diluted valuation that has exceeded $20 billion at peaks.
Grayscale’s move signals growing institutional appetite for altcoin exposure despite regulatory headwinds. The firm has filed for a cascade of new crypto ETFs in recent months — including Solana, XRP, and Litecoin products — as the SEC’s approval of spot Bitcoin and Ether ETFs in January and May opened the door for broader digital asset funds. Grayscale’s Bitcoin Mini Trust (BTC) and Ethereum Mini Trust (ETH) have attracted over $3 billion in combined inflows since their July launch, undercutting the 1.5% fee of their flagship GBTC and ETHE products.
The Worldcoin filing faces an uncertain path. The SEC has historically treated most non-Bitcoin, non-Ether tokens as securities, and WLD’s distribution mechanism — tied to biometric verification — adds novel regulatory complexity. Commissioner Hester Peirce has advocated for a token safe harbor framework, but no formal guidance exists. Grayscale will need to demonstrate that WLD is sufficiently decentralized and that the fund’s structure adequately protects investors from custody, valuation, and manipulation risks.
Worldcoin’s market structure also presents challenges. The token’s circulating supply represents a small fraction of its fully diluted valuation, with significant unlocks scheduled over the coming years. The Orb-based distribution creates a continuous supply inflow that could pressure prices. Grayscale’s filing acknowledges these risks, noting that the trust’s net asset value may deviate from the token’s market price during periods of illiquidity.
For Grayscale, the filing is both a product diversification play and a strategic hedge. As Bitcoin ETF competition compresses fees — BlackRock’s IBIT charges 0.12% versus GBTC’s 1.5% — the firm needs higher-margin altcoin products to sustain revenue. Worldcoin’s brand recognition, backed by Altman’s OpenAI association, offers retail appeal that more technically obscure tokens lack. As Cointelegraph reported, the filing expands Grayscale’s growing lineup of crypto-related exchange-traded products beyond Bitcoin and Ether, positioning the firm to capture the next wave of institutional demand — if regulators allow it.
