The position of the SEC and the regulatory importance
The Securities and Exchange Commission (SEC) of the United States has officially announced the suspension of the order for the conversion of the Grayscale Digital Large Cap Fund LLC into an ETF. The announcement was formalized on July 2, 2025, through a letter addressed to the New York Stock Exchange by the deputy secretary of the Commission. The suspension follows the approval, which took place on July 1, 2025, of the trading of the ETF.
James Seyffart, analyst at Bloomberg Intelligence, explains on X that there could be two reasons behind the SEC’s choice:
It can be found here on the SEC website. We have a few theories as to why this happened.
1. The SEC doesn't want to let anything to launch under the 19b-4 process until they officially approve or come up with some framework for digital assets in the ETF wrapper.
Regulation is the key word in this matter. According to Rule 431(e), the SEC holds the power to suspend and review decisions of this caliber, especially when the landscape of digital assets like Bitcoin and Ethereum requires further evaluation. Consequently, the suspension will remain until further notice from the Commission.
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