The U.S. Securities and Exchange Commission (SEC) has once again postponed its decision on proposed exchange-traded funds (ETFs) linked to XRP and Dogecoin, leaving the cryptocurrency community in suspense. This move, announced on May 21, 2025, comes as issuers continue to ride the wave of altcoin-based investment products that have flooded the market in recent months.
The Waiting Game Continues
The SEC’s delay is part of a broader pattern of cautious deliberation over crypto ETFs. Market participants had been eagerly anticipating a decision that could have potentially opened new avenues for institutional investment in these popular cryptocurrencies. However, the regulatory body has opted to take more time to evaluate the proposals. According to sources close to the discussions, the SEC’s hesitancy is rooted in concerns over market manipulation and investor protection. For a deeper dive into the regulatory implications, see our coverage of the SEC’s latest guidance.
Crypto analyst Jenna Thompson noted, “The SEC is in a tight spot. On one hand, there’s undeniable demand for altcoin exposure through regulated channels. On the other, they can’t ignore the risks associated with these volatile assets.”
The Surge of Altcoin Products
In recent months, there’s been a noticeable uptick in the number of altcoin-based ETFs proposed by financial institutions. This surge reflects growing interest from investors seeking diversified crypto portfolios beyond the traditional Bitcoin and Ethereum offerings. The proposed funds aim to capitalize on the popularity of established altcoins like XRP and Dogecoin, which have seen significant price movements and community engagement. This follows a pattern of institutional adoption, which we detailed in our analysis of corporate treasury investments.
“The market’s appetite for these products is palpable,” remarked financial strategist Alex Kim. “Investors are looking for new ways to tap into the crypto space, and altcoin ETFs could provide a more structured approach.”
Historical Context and Market Trends
Historically, the SEC has been cautious with crypto ETF approvals, often citing concerns over the underlying market’s maturity and stability. Previous applications for Bitcoin and Ethereum ETFs faced similar scrutiny before eventual approval. This historical pattern suggests that while the current delay is not entirely unexpected, it underscores the SEC’s meticulous approach to navigating the regulatory landscape.
The crypto market has also experienced considerable volatility in the past few years. Events like “The Merge” and the rise of staking platforms such as Lido and EigenLayer have added layers of complexity to the ecosystem. As the landscape evolves, regulators are tasked with balancing innovation with consumer protection.
Future Implications
The SEC’s decision—or lack thereof—raises questions about the future trajectory of altcoin-based ETFs. If approved, these funds could pave the way for broader institutional adoption and potentially smooth out some of the notorious volatility that altcoins are known for. However, the ongoing regulatory uncertainty may deter some investors in the short term.
For now, the crypto community waits with bated breath for the SEC’s next move, which is expected later in 2025. Until then, the future of altcoin ETFs remains in limbo, leaving market participants to speculate on potential outcomes.
In the grand scheme of things, the SEC’s cautious stance serves as a reminder of the complexities involved in integrating traditional financial frameworks with the fast-paced world of cryptocurrency. The road ahead may be uncertain, but one thing is clear: the conversation around crypto regulation is far from over.
Source
This article is based on: SEC Punts on XRP, Dogecoin ETF Decisions
Further Reading
Deepen your understanding with these related articles:
- Litecoin Surges 7% as SEC Likely to Approve Spot ETF with 90% Odds: Analyst
- The SEC Can Learn From the IRS in Making Regulation Simpler for Crypto
- US crypto groups urge SEC for clarity on staking
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.
