TLDR
- SEC may streamline crypto ETF approval process by October, potentially reducing wait times from 240 days to 75 days or less
- Bitwise warns that more ETFs doesn’t guarantee success – crypto assets need fundamental investor interest to attract money
- Bitwise filed for new Stablecoin & Tokenization ETF, expected to launch around November if approved
- Two new altcoin ETFs tracking XRP and Dogecoin are expected to launch this week in the US
- Federal Reserve plans conference next month on tokenization of financial products and stablecoins
The Securities and Exchange Commission is working on new rules that could dramatically speed up crypto ETF approvals. The changes might take effect as early as October.
Under current rules, the SEC reviews each crypto ETF application individually. This process can take up to 240 days with no approval guarantee.
The new system would work differently. Applications meeting specific requirements would be “virtually guaranteed” approval within 75 days or less.
Bitwise Chief Investment Officer Matt Hougan expects this change to trigger many new crypto ETF launches. He points to ETF history as evidence that streamlined processes lead to more products.
However, Hougan warns against confusing ETF launches with market success. More crypto ETFs won’t automatically mean more investment money flowing in.
ETF Success Depends on Asset Fundamentals
“The mere existence of a crypto ETP does not guarantee inflows,” Hougan explained. Investors need genuine interest in the underlying cryptocurrency.
He expects ETFs tracking assets like Bitcoin Cash might struggle to attract money. Unless these cryptocurrencies gain new momentum, their ETFs may see limited success.
Two new altcoin ETFs are launching this week in the US. They will track XRP and Dogecoin prices for traditional investors.
The first Solana staking ETF launched on July 3 with $12 million in inflows. Bloomberg analyst James Seyffart called this a “healthy start to trading.”
Tokenization ETF Proposal Filed
Bitwise filed a new ETF proposal Tuesday focused on tokenization and stablecoins. The Bitwise Stablecoin & Tokenization ETF would invest in assets benefiting from these growing trends.
Bloomberg analyst Eric Balchunas expects this ETF could launch around Thanksgiving if approved. The fund would hold both stocks and crypto assets related to tokenization.
The filing comes as regulatory attitudes shift toward tokenization. SEC Chair Paul Atkins said he wants to provide relief to ensure Americans aren’t left behind in this space.
Some crypto exchanges like Coinbase and Kraken are exploring tokenized stock trading. This could put them in direct competition with traditional brokerages.
The Federal Reserve plans a conference next month on tokenization and stablecoin business models. This shows growing institutional interest in blockchain-based financial products.
Bitwise acknowledged the evolving regulatory landscape in its filing. The company noted that unclear rules could impact token ownership rights and transfer abilities.
