The US Securities and Exchange Commission (SEC) has postponed its decisions on nine proposed cryptocurrency Exchange Traded Funds (ETFs), extending the approval deadlines for popular products that include Bitcoin, Ethereum, Dogecoin, Litecoin, and XRP. This latest delay was announced on August 18, impacting ETFs from various firms, including Trump’s Truth Social’s spot Bitcoin and Ethereum funds, CoinShares’ Litecoin ETF, and Grayscale’s proposals concerning Dogecoin and multiple XRP investment products by CoinShares, Bitwise, and Canary, among others.
In addition to these delays, the SEC has also deferred discussions surrounding 21Shares’ staking proposal linked to its spot Ethereum ETF and Bitwise’s request for in-kind redemptions for Bitcoin and Ethereum. As a result, many critical rulings are now projected to take place in October.
### Another Delay in Crypto ETF Approvals
This recent round of delays reflects the SEC’s historically cautious approach towards crypto regulation. Throughout the year, the Commission has been methodical, including in March, when it deferred rulings on various altcoin filings for products related to XRP, Litecoin, and Dogecoin—now all aligned under the impending October decision timeline.
The Truth Social fund, submitted in late June, is structured as a commodity trust holding direct investments in Bitcoin and Ether. Despite its connection to Donald Trump’s media platform, its operational framework aligns with other existing spot crypto ETFs.
Bloomberg analyst James Seyffart has mentioned that such delays are standard practice, as the SEC aims to develop a comprehensive regulatory structure for digital assets before approving new investment products. He emphasises that the regulator tends to take the full timeframe allowed for responses to 19b-4 filings, which pertain to changes in rules concerning ETFs.
Seyffart highlighted that upcoming days would see decisions on a range of XRP exchange-traded products as well, expressing confidence that these time extensions are typical and reflect the Commission’s thorough approach.
### A Shift to a New Filing System
Seyffart also pointed out that the SEC is considering implementing a revised filing system, which would simplify the process for issuers. This new framework would eliminate the need for separate 19b-4 change requests for individual products. Instead, issuers could submit standard S-1 registration statements, undergo a 75-day review period, and automatically list funds if the underlying assets met specified regulations.
Key factors for this new criterion would encompass market capitalisation, trading volume on regulated exchanges, and daily liquidity levels, which are essential for ensuring that new crypto investment products align with established financial standards.
As the situation evolves, industry participants await the SEC’s forthcoming decisions, hoping that a clearer regulatory atmosphere will support the growth and acceptance of cryptocurrency-based investment vehicles.
