The recent developments in Crypto ETF Approvals have sparked significant interest among investors and market analysts. The Securities and Exchange Commission (SEC) has implemented new generic listing standards that effectively render the prior 19b-4 deadline process obsolete, according to Bloomberg Senior ETF Analyst, Eric Balchunas. With these changes, the odds of approval for Litecoin, Solana, and XRP ETFs are now seen as a sure thing.
“Honestly, the odds are really 100% now,” Balchunas shared on social media, referring to the Crypto ETF Approvals that Bloomberg previously predicted had a 90% to 95% chance of being authorized by the end of the year. The new standards have made the 19b-4s and their ‘clock’ meaningless. Now, the only step remaining is the S-1s waiting for a formal green light from the SEC’s Division of Corporation Finance.
SEC Approval Process Simplified
The SEC had initially set deadlines for potential approval of various issuers’ Litecoin, Solana, and XRP ETFs on October 2, 10, and 17, respectively. However, these could now be approved or denied at any time without being tied to those dates. Balchunas, alongside fellow Bloomberg ETF Analyst James Seyffart, had earlier raised the odds of approval for these ETFs to 95% back in June.
The 19b-4 filings were part of a two-step application process with the SEC, filed by exchanges such as Nasdaq, NYSE Arca, and Cboe BZX on behalf of crypto ETF issuers. If acknowledged by the SEC and published on the Federal Register, it would start the clock on the agency’s approval and deadline process. The other critical form, the S-1 registration statement, does not result in any deadlines.
Impact of New Generic Listing Standards
The SEC’s decision to approve new exchange listing standards for crypto ETFs on an accelerated basis earlier this month is a game-changer. This move fast-tracks pending crypto ETF applications and reduces potential review timelines for new submissions from 240 days to as few as 75.
Exchanges like Nasdaq, NYSE Arca, and Cboe BZX can now list and trade crypto funds that meet the generic standards without filing new 19b-4 forms, provided the underlying asset has a futures contract listed on any designated contract market for at least six months. Notably, Coinbase Derivatives is one such market, which includes futures for Litecoin, Bitcoin Cash, Dogecoin, Polkadot, Avalanche, Chainlink, Stellar, Solana, Hedera, Cardano, and XRP.
“The last time they implemented generic listings standards for stock and bond ETFs, launches tripled,” Balchunas noted. “There’s a good chance we could see over 100 crypto ETFs launched in the next 12 months.”
After the debut of U.S. spot Bitcoin and Ethereum ETFs earlier this year, numerous new spot crypto ETF filings are now awaiting approval from the SEC. Since Paul Atkins assumed the role of the agency’s new chairman in April, he has promised a more welcoming approach to digital assets.
In conclusion, with Crypto ETF Approvals now virtually guaranteed, the crypto market is poised for significant growth and diversification, offering investors a wide array of new opportunities.
