Grayscale Stellar Lumens Trust (XLM) SEC 10-Q Report
Grayscale Stellar Lumens Trust (XLM), a passive investment vehicle managed by Grayscale Investments, has released its Form 10-Q report for the quarter ending June 30, 2025. The report provides a detailed overview of the Trust's financial performance and operational highlights, reflecting the value of its XLM holdings, less expenses and liabilities.
Financial Highlights
Net realized and unrealized (loss) gain on investment in XLM: The Trust reported a net realized and unrealized loss of ($2,589) thousand for the three months ended June 30, 2025, primarily due to the depreciation of XLM from $0.26 per XLM as of March 31, 2025, to $0.24 per XLM as of June 30, 2025.
Net (decrease) increase in net assets resulting from operations: The Trust experienced a net decrease of ($2,784) thousand for the three months ended June 30, 2025, which includes the net realized and unrealized loss on investment in XLM and the Sponsor’s Fee of $195 thousand.
Net assets: As of June 30, 2025, the Trust's net assets stood at $28,536 thousand, marking a 9% decrease over the three-month period. This decline was attributed to XLM price depreciation and the withdrawal of approximately 734,805 XLM to pay the Sponsor’s Fee.
Net realized and unrealized gain on investment in XLM: For the nine months ended June 30, 2025, the Trust reported a net realized and unrealized gain of $16,745 thousand, driven by the appreciation of XLM from $0.10 per XLM as of September 30, 2024, to $0.24 per XLM as of June 30, 2025.
Net increase in net assets resulting from operations: The Trust saw a net increase of $16,109 thousand for the nine months ended June 30, 2025, which includes the net realized and unrealized gain on investment in XLM, less the Sponsor’s Fee of $636 thousand.
Net assets: The Trust's net assets were $28,536 thousand as of June 30, 2025, representing a 170% increase over the nine-month period. This growth was driven by XLM price appreciation and the contribution of approximately 13,851,843 XLM, valued at $1,853 thousand, to the Trust in connection with Share creations during the period.
Business Highlights
Trust Overview: The Grayscale Stellar Lumens Trust (XLM) is a passive investment vehicle managed by the Sponsor, aiming to reflect the value of XLM held by the Trust, less expenses and liabilities. The Trust issues Creation Baskets in exchange for XLM deposits and does not utilize leverage or derivatives.
Reorganization Impact: On January 1, 2025, Grayscale Investments, LLC underwent a reorganization, merging with Grayscale Operating, LLC, which then assigned its Sponsor contracts to Grayscale Investments Sponsors, LLC. This reorganization did not materially impact the Trust's operations.
Investment Transactions: The Trust records investment transactions on a trade date basis, with changes in fair value reflected as net change in unrealized appreciation or depreciation. Realized gains and losses are recognized in connection with transactions, including settling obligations for the Sponsor’s Fee in XLM.
Principal Market Determination: The Trust determines its principal market annually and conducts quarterly analyses to ensure the selected market remains the most advantageous for calculating the Trust’s net asset value. The principal market is selected based on volume, activity, and price stability.
Fair Value Measurement: The Trust uses fair value as its method of accounting for XLM, in line with its classification as an investment company for accounting purposes. The fair value is determined by the price that would be received for XLM in a current sale.
Operational Risks: The Trust is subject to various risks, including market risk, liquidity risk, and risks related to its concentration in XLM. The price of XLM is volatile and influenced by factors such as global supply and demand, competition, and regulatory developments.
Future Outlook: The Trust may consider operating a redemption program in the future, subject to regulatory approval and the Sponsor's discretion. The Trust currently has no intention of seeking such approval.
Service Provider Reliance: The Trust relies on third-party service providers for essential operations. Disruptions in these services could impact the Trust's ability to function effectively.
Regulatory Environment: The SEC's stance on digital assets as securities could impact the Trust's operations. The SEC's crypto task force aims to develop a regulatory framework, which may affect the Trust's compliance and operational strategies.
SEC Filing: Grayscale Stellar Lumens Trust (XLM) [ GXLM ] - 10-Q - Aug. 01, 2025