SEC Opens Door to New Wave of Crypto ETFs with Multiple Application Reviews

Bitcoins TLDR

• SEC acknowledged multiple new crypto ETF applications including Solana, Litecoin, and XRP ETFs, setting approval/denial deadlines
• Grayscale’s Solana ETF application marks first acknowledgment for a cryptocurrency previously labeled as a “security”
• BlackRock proposed allowing in-kind creations & redemptions on iShares Bitcoin ETF
• Cboe filed four 19b-4 documents for XRP ETFs from Bitwise, 21Shares, Canary Capital, and WisdomTree
• JPMorgan estimates an approved Solana ETF could attract $3-6 billion in first year assets

The U.S. Securities and Exchange Commission (SEC) made several moves on February 6, 2025, indicating a shift in its approach to cryptocurrency exchange-traded funds (ETFs). The regulatory body acknowledged multiple ETF applications for various digital assets, including Solana, Litecoin, and XRP.

The SEC acknowledged Grayscale’s filing for a Solana ETF, marking the first time the agency has recognized an ETF application for a cryptocurrency that was previously categorized as a security. This acknowledgment gives the Commission until October 2025 to make a decision on the application.

The agency had previously instructed Cboe to remove its uploaded 19b-4 documents for Solana ETFs, making this recent acknowledgment a clear departure from its earlier stance. Bloomberg Intelligence senior ETF analyst Eric Balchunas noted this change appears to be directly related to new leadership at the SEC.

Alongside the Solana ETF acknowledgment, the SEC also reviewed Grayscale’s application for a Litecoin ETF. This development aligns with predictions from industry analysts who believe Litecoin could be next in line for ETF approval after Bitcoin and Ethereum.

BlackRock, the world’s largest asset manager, received acknowledgment for its proposal to allow in-kind creations and redemptions on its iShares Bitcoin ETF. This technical change could improve the efficiency of the fund’s operations.

XRP ETFs

During evening hours, Cboe filed documents to list and trade shares of four separate XRP ETFs. The exchange submitted 19b-4 documents for prospective ETFs from Bitwise, 21Shares, Canary Capital, and WisdomTree. All four issuers had previously filed S-1 forms, which represent the initial step in bringing an ETF to market.

The timing of these developments suggests companies feel more confident exploring beyond Bitcoin and Ether ETF products under the current SEC administration. This marks a shift from the previous regulatory environment, which was more restrictive toward crypto-based investment products.

Solana ETFs

JPMorgan provided estimates for potential market impact, projecting that an approved Solana ETF could attract between $3 billion and $6 billion in net assets during its first year of trading. Bloomberg analysts described this prediction as “reasonable.”

Predictions markets are also weighing in on the likelihood of approval. The platform Polymarket shows traders estimating a 39% chance of a spot Solana ETF receiving approval before July 31, 2025.

The SEC’s review process for Grayscale’s Solana ETF application will conclude around October 11, 2025, according to Bloomberg ETF analyst James Seyffart. This timeline provides a clear deadline for the agency’s decision.

Other firms including 21Shares, Bitwise, VanEck, and Canary Capital have also filed for spot Solana ETFs through Cboe BZX Exchange on January 28, 2025. Bitwise expanded its crypto ETF ambitions by proposing a spot Dogecoin ETF on the same day.

Finance lawyer Scott Johnsson explained that under previous leadership, the SEC rejected spot Solana ETFs because they were filed as commodity trust shares, which the agency deemed incorrect at the time.

The review process for Solana ETFs was previously complicated by ongoing lawsuits against cryptocurrency exchanges Binance and Coinbase, which included allegations that SOL constituted an unregistered security.

These acknowledgments do not guarantee approval of the ETF applications. However, they initiate formal review periods and require the SEC to make decisions within specific timeframes.