Grayscale’s Cardano ETF application recognized by the SEC

Grayscale’s Cardano ETF Application Recognized by the SEC

Grayscale’s proposal to issue an ETF based on Cardano (ADA) has successfully advanced in the approval process by the US Securities and Exchange Commission (SEC). This would be the first ETF of its kind for Cardano.

Details of the Cardano ETF by Grayscale

Grayscale Investments remains highly active in the crypto sector and now wants to set new standards with another exchange-traded fund (ETF). Their focus is on a pure Cardano (ADA) ETF that should track the price development of ADA 1:1. Grayscale applied for approval with the SEC in mid-2023 and has now taken a significant step forward in the process: the authority has accepted the application and thus initiated a formal review procedure. Grayscale’s confidence in a positive outcome is founded on the fact that they have several crypto ETFs already in the US market.

SEC’s Attitude Towards Grayscale and Crypto ETFs

Grayscale had repeatedly engaged in disputes with the SEC in the past, notably about a Bitcoin ETF based on spot markets. The SEC had dismissed the application several times until Grayscale won in court. Now seeing the Cardano ETF, experts note that the situation differs because of the previous court decision and achieved status for Grayscale. The SEC has since changed its stance to various crypto ETFs designed similarly to Grayscale’s Cardano plans, although the final approval for these asset classes is pending.

Importance of an ETF for Cardano

The introduction of a Cardano ETF in the US could lead to increased liquidity inflow and stabilize ADA’s price. ETFs are popular financial products because they allow investment in the underlying assets without needing direct access to the respective asset market. For Cardano, a green light for its first ETF would symbolize a milestone in broader acceptance and encourage further developments similar to Bitcoin and Ethereum.

Conclusion

The acceptance and further processing of Grayscale’s Cardano ETF application by the SEC is a notable success in the crypto industry. However, it remains to be seen if and when the final approval will be granted and under which conditions the Cardano ETF may eventually operate.