Crypto ETFs: Solana, XRP, Dogecoin with Chances of Approaching Approval
The chances for crypto ETFs in the USA are increasing, and not just Bitcoin and Ethereum could benefit from this. In the list of priorities for the SEC are Solana, XRP, and Dogecoin, as well as five other altcoins.
The battle for approval of crypto ETFs in the USA is entering the crucial phase and, in principle, concerns a broad range of the largest cryptocurrencies. At least that’s how one must interpret the cumulative applications that the influential ETF issuer Grayscale filed with the US Securities and Exchange Commission (SEC) in mid-August. Already practically underway: the launch of crypto ETFs for altcoins like Solana (SOL), XRP, and Dogecoin (DOGE), as well as other digital assets like Cardano (ADA) and Polygon (MATIC). In total, the ambitious Grayscale wants to launch crypto ETFs for eight altcoins quickly, in addition to the Bitcoin ETF, which is eagerly anticipated.
The SEC had previously rejected the applications of various issuers, including Grayscale, for approval of a bitcoin spot ETF. This legal dispute will reach its final phase in the winter. But at the same time, there is positive news in the issue of spot and futures of crypto ETFs in Bitcoin and Ethereum. The main crypto exchange Coinbase continues to offer itself as a partner for issuers to bridge the gap between crypto exchanges and traditional exchanges.
Grayscale, as the second-largest stand-alone issuer of crypto investment products in the US, can present some convincing figures to the SEC. Grayscale reports inflows into its funds, the Grayscale Bitcoin Trust (GBTC, with $ 10.9 billion under management), and Grayscale Ethereum Trust (ETHE, with about $ 3.1 billion) during summer. Grayscale also leverages its fund structure by pointing out that its funds are already widely traded among professional investors and must meet regulatory standards.
The broad focus of Grayscale in terms of crypto ETFs for altcoins can be seen as a consequence of the market spread in capitalization. Grayscale emphasizes here that it wants to respond to increasing demand from investors who want to own different altcoins in specialized funds. However, it is essential for Grayscale to focus mainly on cryptocurrencies with relevant market capitalization and trading volume in the top 20 list, which the SEC also monitors keenly. Thus, Grayscale sets itself apart from Coinbase and others, who also aim for crypto EFTs.
These developments in the market for crypto ETFs bring benefits primarily for the so-called second and third generation of popular cryptocurrencies. In the meantime, talks aren’t limited anymore to just BTC and ETH. Instead, altcoins like Solana are getting attention. Trading volumes on crypto exchanges and media, such as social media, demonstrate interest in such expansion. Finally, Grayscale’s strategic decision to target several altcoins at once is linked to the desire of supporting the continued growth of the crypto ecosystem.
This path that Grayscale now embarks on also translates to bold bets and group-based investment vehicles. The bet is choosing to align with an adjusted legal framework when new crypto financial products get approved. Nevertheless, how the SEC will decide on Grayscale’s numerous applications remains uncertain, as the crypto ecosystem evolves quickly, and laws and their interpretations are adapting as well.
Another angle of these developments lies in the suggestion concerning further range expansions with DeFi (Decentralized Finance) and Web 3.0 being focal segments for ETFs within the securities space. Thereby investors hope for maximum diversity. From a legal and macroeconomic perspective, the introduction of regulated crypto ETFs with a broad underlying spectrum could boost the overarching acceptance of the market. A more heterogeneous ETF landscape would also make it easier for institutional investors to participate in the sovereign crypto space confidently.
The world now eagerly awaits how regulatory processes will unfold in the USA as a model arena for crypto investments in other regions. For the time being, the destinies of crypto ETFs stay interdependent with unpredictable economic decisions and technological innovations.
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