The Prospective Cryptocurrency ETF Landscape
Await approval from the SEC for nearly 90 cryptocurrency exchange-traded funds (ETFs) as they gauge investor enthusiasm for specialized digital assets, building on the success of Bitcoin and Ethereum ETFs launched last year. Market participants anticipate similar demand for lesser-known cryptocurrencies like Avalanche and Litecoin.
Analyst James Seyffart from Bloomberg identified a list of pending applications. Eight of these potential offerings focus on Solana, while seven would include XRP in their portfolios. Additional options involve Dogecoin, Melania, and Cardano as investment targets.
The number of awaiting ETFs has grown; in April, Bloomberg reported 72 crypto-related ETF filings, suggesting a recent increase by around 20 more over the past four months.
Furthermore, on Tuesday, 21Shares applied to the SEC for the first-ever Sei blockchain token (SEI) ETF. The backlog of applications continues to expand despite recent additions like this one.
The SEC’s Deliberative Process
Uncertainty surrounds the timing and outcome of these filings due to the SEC’s sluggish decision-making pace. For instance, Grayscale filed for a Cardano ETF in February but faced an initial August deadline, later pushed back to October this week.
This delay could be attributed to staff reductions; the SEC has lost approximately 15% of its workforce since the Trump administration’s buyout program, impacting operational efficiency.
Meanwhile, market forces aim to expedite the crypto ETF approval process. In July, the New York Stock Exchange, Chicago Board of Exchange, and Nasdaq proposed listing standards for these vehicles.
The Lucrative Crypto Fund Market
The demand for crypto funds remains strong, evidenced by BlackRock’s iShares Bitcoin Trust ETF which now generates more in fees than its flagship S&P 500 fund. This fund and similar products launched in Canada and Europe highlight the industry’s growing prominence.
However, as of press time, BlackRock has no other crypto ETFs pending SEC approval.
