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          Stradley Ronon Stevens & Young, LLP

          2000 K Street, N.W.

          Suite 700

          Washington, DC  20006-1871

          Telephone  202.822.9611

          Fax  202.822.0140

          www.stradley.com

  Michael W. Mundt

  Admitted only in Virginia

  Practice Limited to Federal Securities Law Matters

  (202) 419-8403

  mmundt@stradley.com

  July 29, 2024

  Filed via EDGAR

  Mr. Asen Parachkevov

  Mr. Timothy A. Worthington

  U.S. Securities and Exchange Commission

  100 F Street, NE

  Washington, DC  20549

          Subject:

          Grayscale Funds Trust (the “Registrant” or “Trust”)

          (File Nos. 333-271770; 811-23876)

  Dear Messrs. Parachkevov and Worthington:

  On behalf of the Registrant, below are the Registrant’s responses to the comments you provided to J. Stephen Feinour, Jr. of Stradley Ronon
    Stevens & Young, LLP with regard to Pre-Effective Amendment Nos. 5/5 (“PEA 5”) to the Registrant’s registration statement on Form N-1A (the “Registration Statement”), filed with the U.S. Securities and Exchange Commission (“SEC”) on May 1, 2024
    under the Investment Company Act of 1940, as amended (the “1940 Act”), and the Securities Act of 1933, as amended (the “Securities Act”).  The Registration Statement relates to the registration of the Grayscale Privacy ETF (the “Fund”). Below we have
    provided your comments (in bold) and the Registrant’s response to each comment. Capitalized terms not otherwise defined in this letter have the meanings assigned to the terms in the Registration Statement.

          Principal Investment Strategy

          1.

          Comment: Given that the Fund will invest in companies focused on blockchain-based
            technology, please retain the disclosure indicating that the Fund will not invest directly or indirectly in digital assets.  If the Fund will invest indirectly, please clarify to what extent it will do so.

          Response: The Registrant notes that the Fund may be invested in issuers that have exposure
            to digital assets.  However, the Fund does not currently intend on investing directly in digital assets or indirectly in digital assets through the use of digital asset derivatives. The Registrant has revised the section of the Fund’s
            Prospectus titled “Principal Investment Strategy” as follows in response to the Staff’s comment:

          “The Fund will not invest in digital assets directly or through the use of
                derivatives. The Fund also will not invest in initial coin offerings. The Fund may, however, have indirect exposure to digital assets by virtue of its investments in companies that use one or more digital assets as part of their business
                activities or that hold digital assets as proprietary investments.”

  Mr. Asen Parachkevov

  Mr. Timothy A. Worthington

  U.S. Securities and Exchange Commission

  July 29, 2024

  Page 2

          2.

          Comment:  The disclosure states that “Under normal circumstances, the Fund will invest at least 80% of its net assets (including investment
            borrowings) in the securities of the constituents that comprise the Index.” Please clarify the language “securities of the constituents” to make it clear that it would be “securities of the Index” or “constituents of the Index.”

          Response:  The Registrant has revised the section of the Fund’s Prospectus titled “Principal Investment Strategy”
            as follows in response to the comment:

          “Under normal circumstances, the Fund will invest at least 80% of its net assets (including investment borrowings) in the securities of the

            constituents that comprise the Index and in other instruments that have economic characteristics and provide investment exposure similar to the components of the Index. Other instruments that have economic characteristics and provide
              investment exposure similar to the component securities of the Index include depositary receipts (such as American Depositary Receipts (“ADRs”) and Global Depositary Receipts (“GDRs”)). The Fund invests in equity securities (e.g., common stock) and depositary receipts of companies included in the Index.”

          3.

          Comment:  The disclosure states that the Index will track the performance of companies in “developed and emerging markets...” Does a company’s
            classification as a “developed market” company or an “emerging market” company impact its inclusion in the Index? If so, please disclose that and explain if and how the Index Provider classifies companies for purposes of this distinction.

          Response:  In order to be included in the Index by the Index Provider, a company must be classified as a developed or emerging market company as
            determined by the Index Provider.

          The Registrant has revised the section of the Fund’s statutory Prospectus titled “Additional Information About the Index”
            as follows in response to the comment:

          “The Index Provider uses a rules-based framework to classify a country as developed, emerging or frontier by evaluating the economic, financial and
              institutional characteristics of a country.  Economic factors include Gross National Income per capita and the Human Development Index. Financial characteristics consider aggregate market capitalization of a country by considering all of the
              primary listings of domestic stock exchanges.  Institutional characteristics measure the liquidity of a country considering all the primary listings of domestic stock exchanges.”

          4.

          Comment:  The disclosure states that “The Index is designed and maintained by Indxx (the “Index Provider”) to track the performance of companies in
            developed and emerging markets that are involved in providing data security and protection, data privacy, cybersecurity products and services including blockchain-based technology solutions, artificial intelligence “AI”, and edge computing
              solutions.” Please revise this disclosure to clarify that these services tie into the overall data privacy theme as you have done with the other sub-themes.

  Mr. Asen Parachkevov

  Mr. Timothy A. Worthington

  U.S. Securities and Exchange Commission

  July 29, 2024

  Page 3

          Response:  The Registrant has revised the section of the Fund’s Prospectus titled “Principal Investment Strategy”
            to add the following disclosure and as shown below in response to Comment #6:

          “Below is a more detailed summary of the four sub-themes of the Data Privacy theme:”

          5.

          Comment:  For clarity and to better contrast the three “core” sub-themes referenced, please consider whether the term “core” should be replaced with
            a term like “primary,” or whether the term “primary” should be added to the description of the core themes.

          Response:  The Registrant believes that it may introduce confusion with the current usage of primary and secondary for scoring of Pure Play companies
            (Pure Play companies that have an exposure score equal to or greater than 8 are considered “Primary” and Pure Play companies that have an exposure score less than 8 are considered “Secondary”) if the Registrant were to replace the “core”
            terminology in describing the sub-themes.  That being said, the Registrant has revised the description of the “core” sub-themes by adding the word “primary” as shown in response to Comment #6 below:

          6.

          Comment:  We note the first use of the term/concept “overall Data Privacy theme” in the middle of the first paragraph.  Please clarify that the four
            segments discussed in the paragraph (Data Privacy Solution Providers, Cyber Service Providers, Blockchain-Based Privacy Solutions and Network and Communication Security Providers) constitute the “overall Data Privacy theme.”

          Response:  The Registrant has revised the section of the Fund’s Prospectus titled “Principal Investment Strategy”
            as follows in response to the comment:

          “The Index is constructed by the Index Provider pursuant to its proprietary methodology, which seeks to construct a portfolio of constituents across three
            core primary sub-themes (Data Privacy Solution Providers, Cyber Service Providers and Blockchain-Based Privacy Solutions) (the “Core Data Privacy Segment”) and one secondary sub-theme (Network and Communication Security Providers),
              which constitute of the overall Data Privacy theme.”

          7.

          Comment:  Please revise the ordering in the discussion of the three core sub-themes and the secondary sub-theme so that the three core sub-themes and
            corresponding bullet points are discussed/grouped together, followed by discussion of the secondary sub-theme.

          Response:  The Registrant has revised the section of the Fund’s Prospectus titled “Principal Investment Strategy”
            to re-order the discussion of the sub-themes and add sub-headings for “Core Data Privacy Segment” and “Secondary Sub-Theme” above the corresponding bullet points.

          8.

          Comment:  Please include a plain English description/definition of what is meant by the term ‘zero trust’ security.

          Response:  The Registrant has revised the section of the Fund’s Prospectus titled “Principal Investment Strategy”
            as follows in response to the comment:

          “Data Privacy Solution Providers: Companies that provide solutions to individuals or businesses for data protection, secure data storage, prevention of web
            and advertising tracking, identity and access management and data security. It also includes companies that are working on providing ‘zero trust’ security, encryption-based solutions. Zero Trust security is a data privacy concept that
              assumes no user, system, or network (whether inside or outside of an organization’s network) can be trusted – by default. Instead, it calls for constant verification of every user and device attempting to access resources, regardless of their
              location. Zero Trust security enhances privacy by reducing the risk of data breaches and improving the organization's overall security and privacy infrastructure.”

  Mr. Asen Parachkevov

  Mr. Timothy A. Worthington

  U.S. Securities and Exchange Commission

  July 29, 2024

  Page 4

          9.

          Comment:  Please include a plain English description/definition of what is meant by the term “edge computing.”

          Response:  The Registrant has revised the section of the Fund’s Prospectus titled “Principal Investment Strategy”
            as follows in response to the comment:

          “Cyber Service Providers: Companies that provide solutions for enhancing web security and providing protection against cyber-attacks, including those
            utilizing A.I. and edge computing in their product offerings. It also includes companies that provide consulting services in the cyber threats and data security domains to various organizations. Edge computing is a technology approach where
              data processing and storage occur closer to the data source or the end user, rather than relying solely on a centralized cloud server. This is done to improve response times and save bandwidth. In other words, data is processed near its
              source, reducing the time it takes for data to travel. By handling tasks locally, edge computing reduces the load on central servers and the internet, leading to faster and more efficient data processing.”

          10.

          Comment:  The disclosure states that “The Index is comprised of constituents that have business operations that are related to the overall Data
            Privacy theme, as defined by the four sub-themes, and derive substantial portions of their revenue (i.e., greater than 50%) from one or multiple of the sub-themes.”  Please consider deleting this statement. The disclosure that appears below it,
            which addresses eligibility for inclusion in the index followed by the securities selection process, is more clear without the statement, particularly as business operations are a consideration in the scoring system only after a security meets
            the pure play threshold.

          Response:  In response to the comment, the Registrant has deleted the above referenced disclosure as requested.

          11.

          Comment:  The disclosure states “Companies eligible for inclusion in the Index must be publicly listed on a U.S., non-U.S. developed market or
            emerging market stock exchange…”  Please consider revising this disclosure to more broadly refer to developed markets including the U.S.

          Response:  The Registrant has revised the section of the Fund’s Prospectus titled “Principal Investment Strategy”
            to include the following bullet point.

          “Their listing either in a developed (including the U.S.) or emerging market based on the Index Provider’s country classification system, in the form of
              common stock or depositary receipt (American or global).”

          12.

          Comment:  Please consider arranging the disclosure regarding the Index Provider’s security selection process similar to how it is done in the
            statutory prospectus (i.e., with bullet points).

          Response:  The Registrant has revised the disclosure as requested.

  Mr. Asen Parachkevov

  Mr. Timothy A. Worthington

  U.S. Securities and Exchange Commission

  July 29, 2024

  Page 5

          13.

          Comment:  In the discussion of the Index Provider’s security selection process, please include disclosure about the characteristics and qualities
            that go into the determination about the level of business operations (see, e.g., your response to Comment 41 in your responses to our comments on Pre-Effective Amendment Nos. 4/4).

          Response:  The Registrant has revised the section of the Fund’s Prospectus titled “Principal Investment Strategy”
            to add the following disclosure in response to the comment:

          “Business exposure to a sub-theme is a binary evaluation of the business segments that a company is engaged in (i.e., either the business segment is or
              is not in a particular sub-theme), with no measurement to the level of involvement in a particular sub-theme for purposes of the exposure score. Publicly available resources, documents and data, primarily annual reports, of eligible companies
              are reviewed to identify the products, solutions, and/or services that such companies are engaged in and to determine whether they can be classified under the Core Data Privacy Segment. Upon such evaluation, revenue may be an indicator of
              active participation in a particular sub-theme, but amount of revenue is not considered for purposes of assigning an exposure score.”

          14.

          Comment:  The disclosure states that “After the revenue-based scoring, companies are then scored based on their business commitments to data privacy,
            measured by their adherence and alignment to global data privacy regulations such as the General Data Protection Regulation (“GDPR”) and, California Consumer Privacy Act (“CCPA”) and others.” Please consider whether the use of the term
            “global” is appropriate in this context since the two cited examples have limited geographic scope.

          Response:  The Registrant has revised the disclosure in the section of the Fund’s Prospectus titled “Principal
              Investment Strategy” to replace the referenced paragraph with the following:

          “The mission/vision/business commitment of the company: whether or