David Edwards
Decisions on two well-known cryptocurrency exchange-traded fund (ETF) proposals have been delayed by the U.S. Securities and Exchange Commission (SEC): Bitwise’s request to add Ether staking to its ETF and Grayscale’s attempt to introduce an XRP ETF. The agency’s standard procedure for managing intricate regulatory files related to cryptocurrency is reflected in the delays, as anticipated by market watchers.
Citing the need for additional analysis of the proposed rule change and related concerns, the SEC extended its deadline for Bitwise’s proposal by forty-five days in a statement issued on May 20. The first deadline for a decision was May 22.
The SEC also postponed making decisions on Bitwise’s Solana ETF and Grayscale’s XRP ETF, stating that it will consult with the public and carry out a more thorough investigation to ascertain whether they complied with federal securities regulations.
The delays were consistent with the SEC’s routine process, according to Bloomberg ETF analyst James Seyffart, who clarified that the agency usually makes use of the entire period permitted by the 19b-4 filing framework. He pointed out that early approvals are extremely unlikely because the majority of these submissions have final deadlines that extend into October.
Seyffart stressed that the SEC’s activities are procedural in nature rather than driven by politics, notwithstanding the delays. “No matter how crypto-friendly this SEC is, there’s no conspiracy here,” he stated.
Additionally, Seyffart forecasted that decisions on other spot crypto ETFs, such as those based on Litecoin, will probably see comparable delays. He did concede, though, that Litecoin had a far better chance of receiving early clearance than other altcoins.
Proposals for XRP ETFs are anticipated to go to crucial SEC review phases in the days ahead, but Seyffart stated that any approvals before to late June or early July would be unexpected. He expects early Q4 to see the majority of final verdicts.
Following previous Chair Gary Gensler’s resignation in January, the SEC’s stance underwent a significant change, which is reflected in the surge of crypto ETF registrations. During his 2021–2024 term, Gensler took a strict stance on regulations, pursuing more than 100 enforcement proceedings against cryptocurrency companies. A number of cases, including those against Gemini and Cumberland DRW earlier this year, have been dropped since his departure.
With more ETF decisions due in June, including Grayscale’s and 21Shares’ applications for Polkadot ETFs, the SEC has a full agenda going forward. These changes highlight the growing interaction between federal regulators and the cryptocurrency industry in determining the direction of investment vehicles for digital assets.
