It is believed by Bloomberg ETF analyst James Seyffart that, among the various cryptocurrency fund applications currently under review, a Litecoin ETF is more likely to receive initial approval from the SEC.
A decision on Bitwise’s proposal to incorporate staking into its Ether exchange-traded fund, along with Grayscale’s application for an XRP ETF, has been delayed by the U.S. Securities and Exchange Commission—a move that had been anticipated by analysts.
On May 20, it was announced by the SEC that a 45-day extension would be applied to its review of Bitwise’s application, allowing additional time to “consider the proposed rule change and the issues raised therein.” A decision or deferral had been required by the agency no later than May 22.
A delay was also announced by the agency in making determinations on Grayscale’s XRP-tracking ETF and Bitwise’s Solana-tracking fund, as public comments are being solicited and formal proceedings have been initiated to permit further analysis of the proposals, ensuring their compliance with regulatory requirements.
It was stated by Bloomberg ETF analyst James Seyffart on X that both delays had been anticipated, as the SEC is known to typically utilize the entire allotted period to respond to a 19b-4 filing.
Seyffart added that “almost all of these filings have final due dates in October,” and it was noted by him that issuing a decision ahead of that timeline would be considered “out of the norm.”
It was stated by him that, regardless of how favorable toward crypto the current SEC may appear, “no conspiracy is present in this matter.”
It was mentioned by Seyffart that delays are also anticipated for other spot cryptocurrency ETF proposals, with decisions on Litecoin (LTC) ETFs likewise expected to be postponed by the SEC.
However, it was added by him that “Litecoin is one that possesses a greater likelihood of being approved ahead of the others.”
Seyffart stated that “a number of XRP ETPs have upcoming dates within the next few days,” and noted that if early approvals by the SEC were to occur for any of these assets, they would not be expected until late June or early July at the earliest, with early fourth quarter being a more probable timeframe.
SEC Faces Surge in Crypto ETF Applications
A number of other cryptocurrency ETF applications are nearing their respective SEC deadlines in June. According to an SEC filing, a decision is required to be made by the agency on Grayscale’s Polkadot (DOT) tracking ETF by June 11, while 21Shares’ Polkadot ETF is scheduled for review by June 24.
A wave of altcoin ETF filings was received by the SEC following the election of Donald Trump in November and the subsequent resignation of former SEC Chair Gary Gensler.
Gensler’s tenure at the SEC, spanning from 2021 until his resignation on January 20, was regarded by the industry as a period defined by an assertive regulatory approach toward cryptocurrency, with approximately 100 crypto-related enforcement actions being initiated during that time.
Following Gensler’s departure, the SEC has been perceived as significantly more favorable toward the cryptocurrency sector, with legal actions against several firms being dismissed. Among them, crypto exchange Gemini had its case dropped on February 26, and crypto trading firm Cumberland DRW saw its case dismissed on March 4.
