As capital is poured into spot bitcoin and etheric ETFs in recent weeks, the rapidly applied SEC decision could spur the next wave of crypto fund launches.
Single asset ETF applications have been rising in recent months, but products that hold a basket of tokens could be the next one to get a regulatory nod.
Specifically, securities regulators are set to control Grayscale Investments' proposal to convert Digital Large Cap Fund (GDLC) into ETFs. The deadline for doing so is July 2nd.
GDLC has approximately $730 million in assets under management. Over 90% of the fund's assets are allocated to Bitcoin and Ether, but also holds XRP, Solana (SOL) and Cardano (ADA).
Rival fund manager Bitwise is also aiming to convert the BITW Crypto Index Fund. HashDex is currently competing to add assets to the NASDAQ Crypto Index US ETF (NCIQ), which currently holds only BTC and ETH.
The SEC can determine that XRP, SOL, ADA and others represent such small amounts of indexes that allow products to pass, Bloomberg Intelligence Analyst James Safert said at Blockworks permit meeting Tuesday. Alternatively, the agent can choose to develop a comprehensive set of rules first.
“If they're not approved on this first date, that's because the SEC isn't ready for the full framework,” Seyfert said.
The SEC gave Greenlight the Spot Bitcoin ETFS in January 2024.
The BTC offering, led by BlackRock's iShares Bitcoin Trust (IBIT), has so far earned a net inflow of $47 billion, Farside investors data shows. This category has seen an influx of each trading day over the last 11 days, with $589 million participating in the funds on Tuesday.
The $4 billion ether ETF inflow has been accelerating recently. The segment totaled about $1 billion inflows in June alone.
However, providing investors with broad crypto market exposure is a major opportunity, claimed Hashdex CIO Samir kerbage. He previously told Blockworks that his company would eventually want to create a “Nasdaq 100 for Crypto.”
“If you're investing solely in Bitcoin, we're deciding to shorten the crypto market,” Kerbage added at the time.
read more: Crypto Indexes offers the “best opportunity” as the SEC decisions approach: Hashdex CIO
Last month, Grayscale ETF Principal David Lavalle said on Nate Geraci's Crypto Prime Podcast that he expects the multi-token offering to be the next Crypto ETF in the launch.
“We've had a good conversation with the NYSE and the SEC, reaching where we think we can bring that product to the market with product wrappers that are traded on exchanges.”
The SEC is considering a single asset spot Crypto ETF with a focus on Litecoin, Solana, XRP, Dogecoin, Cardano and more. The agency asked future Solana ETF publishers to modify the S-1 form earlier this month, sources told BlockWorks.
Analysts at Bloomberg Intelligence say they expect these single asset products to be approved by the end of the year. The SEC deadline, which controls many of them, will not come until autumn.
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SEC Commissioner Hester Peirce calls for patience with crypto-related advancements, including ETF Arena. She said last month's trillions podcast that comment letters from the exchange recommend “general listing standards” for crypto ETFs.
