The landscape for cryptocurrency exchange-traded funds (ETFs) in the United States is looking increasingly promising, with Bloomberg analysts raising the likelihood of regulatory approval to “90% or higher.” This shift in sentiment is attributed to a more favorable stance from the Securities and Exchange Commission (SEC).
According to Bloomberg senior ETF analysts Eric Balchunas and James Seyffart, discussions between the SEC and asset managers seeking to broaden the scope beyond Bitcoin have been positive. The SEC’s classification of cryptocurrencies like Litecoin, Solana, XRP, Dogecoin, and Cardano as commodities rather than securities is seen as a positive development that could pave the way for a new wave of crypto ETFs.
Recent interactions between the SEC and issuers pursuing spot Solana ETFs have been encouraging. The SEC requested additional information on in-kind redemptions and the potential for staking in these funds, prompting firms to expedite their submissions. The regulator is expected to respond within 30 days, fueling expectations of approvals within the next four to five weeks.
The success of spot Bitcoin ETFs, such as BlackRock’s iShares Bitcoin Trust (IBIT), which surpassed $70 billion in assets within a year of its launch, has set a precedent for the industry. However, Ethereum ETFs have faced slower adoption rates, with some investors experiencing losses compared to their initial investments.
In response to the growing demand for crypto ETFs, issuers like Franklin Templeton have filed proposals for funds tied to assets like XRP and Solana. While Balchunas and Seyffart anticipate approvals in the future, they caution that the process may still take several months before these ETFs hit the market.
Overall, the outlook for cryptocurrency ETFs in the US is optimistic, with regulatory barriers gradually being overcome. As the SEC continues to engage with asset managers and review fund structures, the stage is set for a new era of diversified crypto investment opportunities for investors.