In a groundbreaking move, the U.S. Securities and Exchange Commission (SEC) has simplified the path for exchanges to list exchange-traded products (ETPs) that hold spot commodities, including cryptocurrencies. Announced on Wednesday, this decision allows exchanges to sidestep the previously cumbersome 19(b) rule filing process—a procedure that could stretch up to 240 days and required the SEC’s direct approval for each new ETF. This initiative is set to significantly streamline the process, enabling a more agile entry of cryptocurrency-related products into regulated U.S. markets.
Streamlined Process for Crypto ETFs
The new rules aim to ease the burden on ETF issuers who can now approach exchanges like Nasdaq, NYSE, and CBOE with their product ideas. If the proposed strategy—whether a single token or a combination—aligns with the established generic listing standards, the exchange can proceed with listing without the SEC’s individual review. This shift is anticipated to accelerate the availability of spot-based crypto ETFs, a move that could be transformative for the digital asset landscape.
SEC Chairman Paul Atkins emphasized the decision’s goal to reduce barriers and bolster innovation within the U.S. financial markets. “By approving these generic listing standards, we are ensuring that our capital markets remain the best place in the world to engage in the cutting-edge innovation of digital assets,” Atkins stated.
Grayscale’s Approval: A Milestone
In tandem with the rule change, the SEC also greenlit the Grayscale Digital Large Cap Fund. This fund mirrors the CoinDesk 5 Index, comprising Bitcoin (BTC), Ethereum (ETH), XRP (XRP), Solana (SOL), and Cardano (ADA). Grayscale’s fund approval marks a significant milestone, reflecting the regulator’s growing openness to crypto assets.
Moreover, the SEC approved options tied to the Cboe Bitcoin U.S. ETF Index and its mini version, broadening the array of crypto-linked derivatives within U.S. markets. These developments underscore a widening acceptance and integration of digital assets within traditional financial frameworks.
A Boon for Altcoin ETFs
The SEC’s revised listing standards could herald a new era for altcoin ETFs, which have eagerly awaited regulatory approval. Industry experts predict a surge in spot-based altcoin ETF offerings. James Seyffart, an ETF research analyst at Bloomberg Intelligence, shared his optimism in a social media post, stating, “This is the crypto ETP framework we’ve been waiting for. Get ready for a wave of spot crypto ETP launches in coming weeks and months.”
Kristin Smith, President of the Solana Policy Institute, echoed this enthusiasm, stating, “We are incredibly encouraged by tonight’s news: the SEC continues to promote the rule of law by setting clear rules of the road for U.S. businesses and to take positive steps to allow American investors to safely access digital assets.” She further remarked on the potential for these standards to drive the next wave of crypto adoption and innovation.
Balancing Perspectives: Opportunities and Challenges
While the SEC’s move is largely seen as a positive step for the crypto industry, it’s not without its potential challenges. Critics caution that the rapid introduction of new products could lead to increased market volatility. There are also concerns about investor protection, as the crypto market continues to grapple with issues such as security breaches and regulatory compliance.
On the flip side, proponents argue that the SEC’s streamlined process will enhance market efficiency and foster greater investor confidence. By providing clearer guidelines and reducing the bureaucratic hurdles for crypto ETFs, the SEC is paving the way for broader participation in the digital asset market.
Looking Ahead: The Path Forward
As the SEC’s new standards take effect, the coming months are likely to see a flurry of activity in the crypto ETF space. This regulatory evolution represents a significant step towards integrating digital assets into mainstream finance, potentially attracting a wider audience to the burgeoning crypto market.
Ultimately, the SEC’s decision reflects a broader trend of increasing institutional acceptance of cryptocurrencies. By facilitating access to these innovative financial products, the U.S. is positioning itself as a leader in the digital asset revolution. As the market evolves, stakeholders will be closely watching how these changes impact both the growth of the crypto industry and the broader financial ecosystem.
Steve Gregory is a lawyer in the United States who specializes in licensing for cryptocurrency companies and products. Steve began his career as an attorney in 2015 but made the switch to working in cryptocurrency full time shortly after joining the original team at Gemini Trust Company, an early cryptocurrency exchange based in New York City. Steve then joined CEX.io and was able to launch their regulated US-based cryptocurrency. Steve then went on to become the CEO at currency.com when he ran for four years and was able to lead currency.com to being fully acquired in 2025.
