The U.S. Securities and Exchange Commission (SEC) continues to 'stall' in approving new cryptocurrency-related ETFs, particularly those based on the spot prices of Hedera (HBAR), Polkadot (DOT), along with a fund combining Bitcoin and Ethereum. This delay not only adds to the impatience of the investor community but also reflects the SEC's extreme caution in the face of the rising wave of crypto ETFs.
New names in the 'waiting list' for crypto ETFs
According to newly released filings on Thursday, the SEC has pushed back the deadline for decisions on the proposed rule changes 19b-4 – a prerequisite for ETFs to be listed on exchanges.
Specifically:
#SEC will have a deadline until June 11 to decide on two filings from Nasdaq:
Canary HBAR ETF (fund tracking the spot price of Hedera),
Grayscale Polkadot Trust (converting to ETF tracking Polkadot).
At the same time, by June 10, the SEC must respond to the proposal from the New York Stock Exchange (NYSE) regarding the Bitcoin and Ethereum combination ETF proposed by Bitwise.
These three ETF funds are part of a list of 72 crypto-related filings currently on the SEC's desk — a number that clearly shows the ETF fever is far from cooling down.
The race to expand ETFs: Altcoins are speaking up
Following the overwhelming success of the approved spot Bitcoin ETFs early in 2024, many organizations quickly expanded their filings to altcoins. Not only Hedera and Polkadot, but names like $SOL , Cardano, $XRP , Dogecoin, $LTC , Avalanche also appeared on the waiting list.
Canary Capital, one of the entities submitting the most ETFs, recently filed for an ETF tracking TRX of Tron, which includes staking rewards. They have also proposed ETFs for PENGU and SUI, two recently emerging tokens.
Grayscale is equally 'ambitious' with a list of funds based on nearly every top altcoin. Meanwhile, Bitwise is focusing on tokens like DOGE and Aptos.
Notably, these ETF filings come not only from crypto companies but also from traditional financial institutions, indicating a broad interest in digital assets within the financial industry.
Assets under management are skyrocketing: Potential and pressure for the SEC
Part of the reason for the high demand for crypto is due to the explosion in assets under management (AUM) of current ETFs:
Grayscale Bitcoin Trust (GBTC) currently manages approximately $18 billion, ranking second among the 11 Bitcoin ETFs approved by the SEC.
Bitwise Bitcoin ETF holds about $3.6 billion, ranking fifth on the list.
The total assets managed by these Bitcoin ETFs have now reached approximately $100 billion, making them one of the fastest-growing products in the 32-year history of the ETF industry. This causes issuing organizations to not overlook the opportunity to expand into other digital asset classes.
Market reaction: Altcoins surge
Immediately after the news of the SEC's delay was announced, the prices of some altcoins recorded positive signals:
Hedera (HBAR) increased by about 5% today,
Polkadot (DOT) surged nearly 7% in the past 24 hours.
Although not officially approved yet, the appearance of these altcoins in the ETF proposal indicates recognition of long-term potential and could attract more capital from institutional investors if given the 'green light' by the SEC.
Crypto market perspective and investors on Binance
For users on Binance, this development brings many points of interest:
If the Hedera, Polkadot, and other altcoin ETFs are approved, institutional capital flowing into these tokens could increase significantly. This could boost liquidity and long-term growth of assets listed on Binance.
However, the SEC's continued delays also indicate that legal risks remain very high. Investors should closely monitor important deadlines such as June 10 and 11 – when the SEC is required to make its next decision.
Conclusion and risk warning
The SEC's continued delays indicate that they are still not ready to fully open the door for altcoins in the ETF world. However, with the massive number of applications and pressure from the financial market, the likelihood of more crypto ETFs appearing in the future is very high.
Risk warning: Investing in cryptocurrency always carries high risks and is not suitable for everyone. The market can be highly volatile due to legal, technical, or investor sentiment factors. You should conduct thorough research before participating or consult with financial experts if necessary.
