SEC Takes Significant Steps Towards Crypto ETFs
The U.S. Securities and Exchange Commission (SEC) has initiated a pivotal move towards permitting new cryptocurrency exchange-traded funds (ETFs) that will track the prices of various digital assets, including Litecoin and Solana. This development, which occurred on Thursday, also includes fresh avenues for redeeming funds from existing crypto ETFs. It marks a noteworthy signal of a more crypto-friendly stance from the agency under its new leadership, particularly as companies advance toward launching XRP ETFs.
Earlier in the day, the SEC officially recognized a filing by Grayscale for a Solana (SOL) ETF, which means the Commission now has until October to make a decision on the application. This acknowledgment is particularly significant as the SEC had previously dismissed several applications for ETFs focused on SOL and instructed Cboe to withdraw its earlier submissions for these ETFs.
Eric Balchunas, a senior ETF analyst at Bloomberg Intelligence, remarked on the importance of this development. He described it as “notable,” emphasizing that it is the first instance in which an ETF filing for a cryptocurrency, previously classified as a “security,” has been acknowledged by the SEC. “We are now in uncharted waters, albeit just a baby step, but this appears to be a direct result of a shift in leadership,” he noted in a post on X.
In addition to Grayscale’s Solana ETF filing, the SEC also recognized a series of other crypto-related ETF applications on the same day. This includes Grayscale’s proposal for a Litecoin (LTC) ETF and BlackRock’s intention to enable in-kind creations and redemptions for its iShares Bitcoin ETF.
During the evening hours in the U.S., Cboe submitted filings to list and trade shares of four separate ETFs aimed at tracking the price of XRP (XRP). The exchange filed four 19b-4 documents with the SEC for the prospective ETFs from Bitwise, 21Shares, Canary Capital, and WisdomTree. Notably, all four issuers had previously submitted S-1 filings, which are the initial steps in bringing an ETF to market.
While the actions taken on Thursday do not guarantee that the SEC will approve all of these products, they do indicate that companies are feeling increasingly confident in expanding their offerings beyond just Bitcoin and Ether ETFs under the current SEC administration.
