The United States Securities and Exchange Commission has delayed the approval of various Spot Exchange-Traded Funds filed by multiple asset managers.
The Commission has delayed the approval of VanEck’s Spot Solana ETF, Canary’s Spot Solana ETF, Canary Spot XRP ETF, Grayscale’s Spot XRP ETF, and Grayscale’s Spot Dogecoin ETF.
Various asset managers filed for the approval of these ETF products following Donald Trump’s arrival in January. The New SEC, headed by acting chairman Mark T. Uyeda, is believed to be pro-crypto, so there has been a spike in ETF filings.
Regulatory Caution
Historically, the SEC has always been cautious about approving ETFs. The process is slow and thorough, involving scrutiny and approval of the S1 File and 19b-4 file of the company filing for an ETF.
After many months of back and forth, the Commission has only approved two ETFs, Bitcoin and Ethereum.
These newer filings, covering less-established cryptocurrencies, may be subject to heightened scrutiny due to risks of market manipulation, investor protection concerns, and SEC concerns.
Regulatory caution could be the key reason behind the delayed approval of ETFs.
Transition Phase
Another key reason for the delay is the SEC’s transition phase in its leadership circle.
The Commision is transitioning, with Mark Uyeda serving as the acting chairman.
The Senate confirmed David Atkins as the new chairman of the SEC. The agency’s ongoing transition could affect key decisions, such as approving an ETF.
Additionally, the SEC’s process involves detailed reviews of 19b-4 and S-1 filings, often requiring amendments. The review can last up to 240 days, especially for novel products.
While Trump’s pro-crypto administration adds pressure for approvals, the SEC is still tasked with maintaining regulatory standards and protecting the American public from financial fraud.
The exchange-traded funds listed for approval by the SEC involve other altcoins like Litecoin, Solana, and XRP.
Bitcoin and Ethereum remain the only crypto assets with an ETF at the moment.
