In keeping with its usual review schedule for cryptocurrency investment products, the Securities and Exchange Commission has delayed decisions on Bitwise’s application to add staking capabilities to its Ethereum exchange-traded fund and Grayscale’s bid for an XRP ETF.
In order to “consider the proposed rule change and the issues raised therein,” the SEC extended its examination time for Bitwise’s Ether staking ETF application by 45 days on May 20. This decision had to be made before the May 22 deadline. Additionally, the federal government postponed decisions on Bitwise’s Solana fund and Grayscale’s XRP tracking ETF, asking for public feedback and starting “proceedings to allow for additional analysis” in order to guarantee regulatory compliance.
James Seyffart, a Bloomberg ETF analyst, saw these delays as anticipated rather than negative events. On X, previously Twitter, Seyffart said, “The SEC usually takes the full time to respond to a 19b-4 filing.” He pointed out that “almost all of these filings have final due dates in October,” and that a speedy judgment would be “out of the norm.”
Seyffart wrote, “Regardless of how crypto-friendly this SEC is,” dismissing rumors of regulatory favoritism. This is not a conspiracy.
For other cryptocurrency ETF applications, such as those that follow Litecoin, the analyst anticipated comparable delays. He did, however, explain that Litecoin “has a higher likelihood vs others of getting approved first.”
As for possible timetables, Seyffart mentioned that there are a number of XRP exchange-traded product applications with due dates in the next few days. If the SEC is going to provide early clearances for any of these assets, I would anticipate seeing them no earlier than late June or early July. He clarified that it was more likely to happen in early 4Q.
Beyond XRP products and Ether staking, the SEC is facing increasing deadlines for other cryptocurrency investment vehicles. The government has until June 11 to make decisions on Grayscale’s Polkadot tracking ETF and June 24 to decide on 21Shares’ Polkadot ETF proposal, per regulatory filings.
Following Donald Trump’s election victory in November and the retirement of previous SEC Chair Gary Gensler, which signaled a major change in regulations, there was a surge in applications for alternative cryptocurrency ETFs. The SEC pursued almost 100 enforcement cases pertaining to cryptocurrency under Gensler’s direction from 2021 to January 20, establishing what industry players perceived as an aggressive regulatory posture toward digital assets.
Many believe that the SEC has taken a more accommodative approach to bitcoin companies since the Gensler ruling. As evidence of the shifting regulatory landscape under new leadership, a number of businesses that were previously the focus of regulatory investigation had their cases dropped, including trading company Cumberland DRW on March 4 and cryptocurrency exchange Gemini on February 26.
After the SEC’s leadership changed, the delayed rulings are a reflection of larger shifts in the bitcoin regulatory system. The dismissal of earlier enforcement cases suggests possible policy changes that may affect future ETF approvals, even as the SEC continues its rigorous evaluation process for new investment products.
Rather than expressing particular opposition to these products, the SEC’s delayed judgments on cryptocurrency ETF applications are a result of routine regulatory practice. As the legal landscape continues to change under the new SEC leadership, analysts expect judgments on a variety of cryptocurrency investment vehicles to be made throughout 2025, with possible approvals starting in late 2025.
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