SEC delays decision on Ether staking and XRP ETFs, as analysts expected

The US Securities and Exchange Commission (SEC) has postponed its decisions on several cryptocurrency exchange-traded fund (ETF) applications, including Bitwise’s Ether staking ETF and Grayscale’s XRP ETF. These delays, while initially causing some speculation, are considered by analysts to be standard procedure given the complexity of the applications.

The SEC cited the need for additional time to review Bitwise’s application, extending its deadline by 45 days. Similarly, decisions on Grayscale’s XRP ETF and Bitwise’s Solana ETF have been pushed back to allow for further analysis and public comment, ensuring compliance with regulatory standards. Bloomberg ETF analyst James Seyffart emphasized that these delays are typical for 19b-4 filings, with most having final due dates in October. He dismissed notions of a conspiracy, stating that the SEC’s actions are consistent with its usual processes, regardless of its perceived stance on crypto.

Seyffart anticipates further delays on other spot crypto ETF bids, including Litecoin ETFs, although he suggests Litecoin has a higher probability of approval. He projects that early approvals, if any, are unlikely before late June or early July at the earliest, with a more realistic timeline pointing towards early Q4.

The SEC is currently managing numerous ETF applications, facing deadlines in June for Grayscale’s Polkadot ETF and 21Shares’ Polkadot ETF. This influx of applications follows the wave of altcoin ETF filings after the 2020 election and the subsequent resignation of former SEC Chair Gary Gensler. Gensler’s tenure was characterized by a robust regulatory approach to crypto, resulting in numerous enforcement actions. However, with Gensler’s departure, a shift towards a more crypto-friendly environment is perceived, evidenced by the dismissal of cases against firms like Gemini and Cumberland DRW. While this shift is noteworthy, the SEC’s recent delays highlight that the regulatory process remains thorough and deliberate, even within this evolving landscape. The SEC’s actions underscore the careful consideration being given to each application, ensuring compliance with existing regulations.