SEC delays decision on Ether staking and XRP ETFs, as analysts expected

SEC Delays Decisions on Ether Staking, XRP, and Solana ETF Applications

The U.S. Securities and Exchange Commission (SEC) has recently postponed its decisions regarding several key crypto-related exchange-traded funds (ETFs). This includes Bitwise’s application to incorporate staking into its Ether ETF, as well as Grayscale’s proposal for an XRP ETF. The delay also impacts Bitwise’s Solana (SOL) tracking fund. As reported by Cointelegraph, these delays were anticipated by industry analysts.

Details of the SEC’s Actions

On May 20, the SEC announced it would extend the decision deadline for Bitwise’s Ether ETF application by 45 days. The agency cited the need for additional time to properly evaluate the proposed rule change and related issues. The original deadline for this decision was May 22.

The SEC has also delayed decisions on Grayscale’s XRP tracking ETF and Bitwise’s Solana tracking fund. This delay allows the agency to solicit public comments and conduct further analysis to ensure these proposals meet the necessary regulatory standards.

Expert Insights on the Delays

Bloomberg ETF analyst James Seyffart commented on X (formerly Twitter) that these delays are not unexpected. He noted that the SEC typically utilizes the full allotted time to respond to 19b-4 filings. Seyffart added that most final decision dates for these filings are in October, making an earlier decision unusual. He emphasized that these delays do not indicate any underlying conspiracy, even with a potentially more crypto-friendly SEC.

Seyffart also anticipates delays for other spot crypto ETF bids, including those for Litecoin (LTC). However, he believes Litecoin ETFs have a higher chance of being approved first compared to other assets. He suggests that early approvals for any of these assets are unlikely before late June or early July, with a more probable timeframe being the fourth quarter.

Broader Context: A Flood of ETF Filings

The SEC is currently reviewing numerous crypto ETF applications, with deadlines approaching in June for several proposals. These include Grayscale’s Polkadot (DOT) tracking ETF, with a deadline of June 11, and 21Shares’ Polkadot ETF, due on June 24.

The Shift in SEC’s Stance on Crypto Regulation

The recent surge in altcoin ETF filings followed Donald Trump’s election and the subsequent resignation of former SEC Chair Gary Gensler. Gensler’s tenure was characterized by a stringent regulatory approach toward the crypto industry, marked by numerous enforcement actions. Since his departure, the SEC is perceived to be adopting a more accommodating stance, with several firms previously facing legal action from the regulator having their cases dismissed.

In Conclusion

The SEC’s decision to postpone rulings on several key crypto ETFs reflects the agency’s cautious approach to regulating digital assets. While these delays may frustrate some investors, they also provide the SEC with the necessary time to thoroughly evaluate these complex financial products and ensure they meet regulatory standards. This comes as Bitcoin and Ethereum continue to navigate a dynamic market landscape, underscoring the need for clear and comprehensive crypto regulation.