The race to launch altcoin exchange-traded funds (ETFs) is heating up even as the ongoing U.S. government shutdown delays the Securities and Exchange Commission’s (SEC) review process.
Despite regulatory bottlenecks, the surge in crypto ETF applications highlights sustained institutional demand for diversified digital asset exposure.
Key Takeaways
The U.S. government shutdown has temporarily delayed SEC reviews of crypto ETF filings.
There are 155 active proposals covering 35 digital assets, led by Solana, Bitcoin, XRP, and Ethereum.
Bloomberg’s Eric Balchunas expects over 200 crypto ETPs could launch in the next 12 months.
Traditional investors are expected to favor diversified and actively managed crypto ETFs.
Shutdown Slows Progress, But Market Optimism Remains High
The partial government shutdown, which began on October 1, has created a backlog in SEC operations, slowing the approval timeline for new crypto ETFs.
Still, optimism across the market remains strong. Bloomberg’s Eric Balchunas, senior ETF analyst, said that despite the pause, the next 12 months could see a “total land grab” for crypto-linked products, with more than 200 ETFs expected to debut once reviews resume.
As of October 20, there are 155 filings for cryptocurrency-based exchange-traded products (ETPs) representing 35 digital assets, according to Bloomberg data.
Solana (SOL) and Bitcoin (BTC) each lead with 23 filings.
XRP follows with 20 proposals, while Ethereum (ETH) trails closely with 16.
Leveraged and Staking ETFs Drive the Next Wave of Innovation
In recent weeks, issuers have expanded filings to include 2x and 3x leveraged ETFs, as well as staking-enabled products designed to generate yield.
These filings leverage the SEC’s newly approved listing standards for commodity-based trusts, allowing broader product innovation — from covered-call Bitcoin strategies to multi-token exposure funds.
The trend underscores a shift toward customizable crypto exposure, appealing to both retail traders and institutional allocators seeking non-spot strategies.
Diversified ETFs Expected to Dominate Market Demand
While single-asset ETFs for Bitcoin and Ethereum have captured headlines, analysts believe traditional investors will favor diversified or actively managed crypto ETFs over individual token plays.
“Traditional finance investors aren’t ready to navigate 30 different tokens,” said Nate Geraci, president of NovaDius Wealth Management.
“They’ll take a diversified, index-style approach to this emerging asset class.”
Spot Bitcoin ETFs, launched in January 2024, and Ethereum ETFs, approved in July 2024, have already drawn $150 billion and $24 billion in assets under management (AUM), respectively, according to The Block.
What Comes Next
Once the government reopens, analysts expect a flood of ETF approvals as the SEC works through the backlog.
With investor appetite growing and issuers racing to secure early market share, the U.S. is on track to see the most significant expansion of regulated crypto investment products to date.
As Balchunas noted, “The moment the lights turn back on at the SEC, we’ll see a wave of launches unlike anything the ETF market has seen in years.”