TLDR
- Bloomberg analyst James Seyffart warns that the potential government shutdown could delay the approval of pending crypto ETFs.
- The looming shutdown creates uncertainty over how the SEC will manage the approval process for crypto ETFs.
- Polymarket data shows a 69% chance of a shutdown by October 1, which could further complicate the situation.
- The SEC has asked issuers to withdraw their 19b-4 filings for certain crypto ETFs, simplifying the approval process.
- Under the new generic listing standards, the SEC could approve crypto ETFs at any time, though approval timelines remain unclear.
The approval of pending crypto ETFs is facing uncertainty due to the looming government shutdown, according to Bloomberg analyst James Seyffart. Seyffart highlighted how the shutdown could complicate the approval process for these funds. His comments come amid speculation about the timing and regulatory hurdles related to the approval of crypto ETFs.
Shutdown Threat Delays Progress on Crypto ETFs Approval
Seyffart discussed how a potential government shutdown could delay the approval process for pending crypto ETFs.
“The shutdown creates a scenario where it’s unclear how the SEC will manage its responsibilities,” Seyffart explained in a recent post.
The government shutdown could stall critical processes needed to finalize decisions on crypto ETFs.
Polymarket data suggests a 69% chance of a shutdown by October 1. The deadline for passing a temporary funding bill is tomorrow, leaving little time for resolution. The potential shutdown has already caused a delay in the markup of the CLARITY Act, scheduled for tomorrow.
Seyffart’s colleague, Eric Balchunas, also expressed uncertainty about the launch schedule for the funds. Balchunas admitted that more details from the SEC are needed to clarify the timeline. This ambiguity surrounding the SEC’s actions raises concerns among investors and market participants.
Crypto ETF Approval Delays Still Uncertain
The SEC’s role in approving crypto ETFs remains critical, especially after the introduction of new generic listing standards. Under these standards, the approval process is expected to be faster and more streamlined. However, it is unclear how long it will take for the SEC Division of Corporation Finance to approve pending crypto ETFs.
Seyffart also noted that the long delay in filing prospectuses for crypto ETFs could further complicate the approval process.
“The approval timeline isn’t about the number of days anymore,” he said. Instead, it hinges on how quickly the SEC signs off on these funds.
In a recent update, journalist Eleanor Terrett reported that the SEC has asked issuers to withdraw their 19b-4 filings for certain crypto ETFs. These filings, which had been necessary for listing crypto ETFs, are no longer required under the new generic listing standards. This change should simplify and speed up the process of listing crypto ETFs.
The SEC’s withdrawal of delay notices signals a shift in how crypto ETFs will be approved moving forward. Under the generic listing standards, exchanges no longer need to submit 19b-4 forms for approval. This change should accelerate the approval process for crypto ETFs, making it easier for issuers to list their funds.
Terrett noted that the SEC could approve these funds at any time under the new system. With the elimination of delay notices, issuers now have a clearer path forward. However, the timeline for approval is still subject to the SEC’s review of the S-1 filings, which include the fund’s prospectus.
Despite these changes, the final deadline for some crypto ETFs, such as the XRP, SOL, and Dogecoin ETFs, is approaching. These deadlines could trigger decisions from the SEC, but the approval timeline remains uncertain.
