Definition ∞ Digital Asset Trusts are investment vehicles that provide traditional investors with exposure to cryptocurrencies without direct ownership of the underlying digital assets. These trusts typically hold a quantity of a specific cryptocurrency, like Bitcoin, and issue shares to investors. The shares trade on regulated stock exchanges, offering a familiar pathway for institutional and retail investors to access the digital asset market. They function similarly to traditional commodity trusts.
Context ∞ The introduction and approval of new digital asset trusts, particularly Exchange Traded Funds (ETFs), are significant news events that can attract substantial capital inflows into the crypto market. Debates often surround their regulatory classification, custody arrangements, and their impact on market prices and liquidity. Their performance is closely watched as a barometer of institutional adoption and broader market acceptance.
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