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Delays in US SEC’s Approvals for Altcoin ETFs
The US Securities and Exchange Commission (SEC), despite recent shifts in its leadership, continues to stall the approval process for exchange-traded funds (ETFs) linked to prominent altcoins, including XRP, Solana (SOL), and Dogecoin (DOGE). Recent developments saw delays for several applications, including those from 21Shares and Grayscale, which aimed to track XRP and DOGE, respectively. Furthermore, the SEC has extended the decision deadlines for Solana ETFs filed by VanEck, 21Shares, Bitwise, and Canary Capital.
In a filing dated May 19, the SEC indicated it required additional time to evaluate whether these proposals meet regulatory criteria. They encouraged public feedback regarding the capacity of these funds to mitigate fraudulent activities and ascertain if any novel concerns have arisen under Section 6(b)(5) of the Exchange Act.
Consultant Insights on SEC Delays
James Seyffart, an analyst from Bloomberg focusing on ETFs, stated that these delays are not surprising and anticipates decisions may not come until the fourth quarter of 2025. He explained that the SEC’s processes are thorough and not exclusively focused on cryptocurrency:
"It’s still a government agency and still a lot of minutiae details to get through. Also, crypto isn’t the only thing they’re working on."
Seyffart emphasised that taking full time to make a decision is the norm for the SEC and that earlier approvals would represent a deviation from standard procedures.
Potential for XRP Futures to Influence ETF Decisions
XRP has received a boost in market confidence with the launch of XRP Futures and Micro XRP Futures by the Chicago Mercantile Exchange, allowing traders to speculate on XRP’s price movements without having to hold the token itself. Giovanni Vicioso, CME’s Global Head of Cryptocurrency Products, noted the growing interest in regularised derivatives offerings across various tokens, underpinning the potential for futures markets to play a crucial role in paving the way for spot ETF approvals.
Historically, regulated futures markets have catalysed ETF approvals, as demonstrated by the DC Circuit Court’s ruling against the SEC’s rejection of Grayscale’s Bitcoin trust conversion, which eventually led to the acceptance of Bitcoin ETFs.
Market Reactions and Future Developments
Despite the ongoing delays, initial signs suggest a burgeoning interest among investors for these altcoin ETFs, although concrete demand levels remain uncertain. The SEC is yet to give clear indications regarding the potential for approval timelines, but as the regulatory landscape evolves, the anticipated influx of public comments may also shape their considerations moving forward.
In summary, while the SEC’s current delays for altcoin ETF applications might be frustrating for investors, it reflects their commitment to thorough evaluations amid an increasingly complex regulatory environment. As developments unfold, XRP’s new futures offerings and public sentiment may play vital roles in influencing future SEC decisions.
