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Joseph A. Hall +1 212 450 4565 joseph.hall@davispolk.com |
Davis Polk & Wardwell LLP 450 Lexington Avenue davispolk.com |
January 20, 2022
| Re: | Grayscale Digital Large Cap Fund LLC |
Amendment No. 3 to Registration Statement on Form 10-12G
Filed November 29, 2021
File No. 000-56284
U.S. Securities and Exchange Commission
Division of Corporation Finance
Office of Finance
100 F Street, N.E. Washington, D.C. 20549
| Att’n: | Justin Dobbie |
John Dana Brown
John Spitz
Becky Chow
Ladies and Gentlemen:
On behalf of our client, Grayscale Investments, LLC, the manager (the “Manager”) of Grayscale Digital Large Cap Fund LLC (the “Fund”), this letter sets forth the Manager’s responses to the comments provided by the Staff of the Division of Corporation Finance of the U.S. Securities and Exchange Commission (the “Commission”) in your letter dated January 7, 2022 on Amendment No. 3 to the registration statement on Form 10-12G (the “Registration Statement”) relating to the registration of the Fund’s shares (the “Shares”) pursuant to Section 12(g) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).
The Manager has revised the Registration Statement in response to the Staff’s comments and is submitting concurrently with this letter Amendment No. 4 to the Registration Statement, including Exhibit 99.1 (the “Information Statement”), which reflects these revisions and updates certain other information. For the Staff’s convenience, each comment is restated in italics prior to the response to such comment. All references to page numbers and captions correspond to pages and captions in the Information Statement.
Amendment No. 3 to Registration Statement on Form 10-12G
Investment Objective, page 6
| 1. | Revise here to state, if true and as disclosed on page 106, that the Manager may, in its sole discretion, select a different reference rate provider. Please also clarify, here and on page 106, that the exercise of such discretion is subject to the Manager’s obligations under the Index License Agreement. |
The Manager has revised the disclosure on pages 7 and 107 in response to the Staff’s comment.
The Manager is solely responsible for determining the value of the Digital Asset Holdings, page 38
| 2. | We note the disclosure here an on page 50 that “[t]here are no predefined criteria to make a good faith assessment as to which of the rules the Manager will apply” and that the Manager may make this determination in its sole discretion. This disclosure may suggest that there are no criteria for determining which rule will apply. Please revise this statement in light of your disclosure on page 67 that the Manager will employ the cascading rules sequentially and in the order as presented. |
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U.S. Securities and Exchange Commission |
The Manager has revised the disclosure on pages 38-39 and 52 in response to the Staff’s comment.
Determination of Digital Asset Reference Rates, page 65
| 3. | We note your response to our prior comment 6. Please revise the statement near the top of page 66 that “[e]ach Digital Asset Reference Rate algorithm penalizes activity from any given Constituent Exchange” to state instead, if true, that the algorithm penalizes inactivity. |
The Manager has revised the disclosure on page 67 in response to the Staff’s comment.
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Please do not hesitate to contact the undersigned if you have any questions regarding the foregoing or if we may provide any additional information.
Very truly yours,
/s/ Joseph A. Hall
Joseph A. Hall
| cc: | Michael Sonnenshein |
Chief Executive Officer
Grayscale Investments, LLC
| January 20, 2022 | 2 | |