Crypto ETFs set to flood US market as regulator streamlines approvals
FILE PHOTO: Representation of cryptocurrencies are seen in this illustration taken September 10, 2025. REUTERS/Dado Ruvic/Illustration/File Photo
Asset managers are lining up to launch cryptocurrency exchange-traded funds, capitalizing on growing excitement around digital assets while getting a boost from looser regulatory requirements to bring products to market.
The U.S. Securities and Exchange Commission's updated standards for ETFs, announced last week, could encourage demand for exchange-traded products tied to cryptocurrencies ranging from solana to dogecoin.
ETFs around the more traditional cryptocurrencies bitcoin and ethereum were launched in 2024 under prior rules that had stricter standards for issuers and exchanges.
There are 21 U.S. ETFs that own either bitcoin or ethereum, or a combination of both, and scores of filings with the SEC for new products tied to other coins.
Analysts said they expect the first products approved under the new rules - likely ETFs tied to cryptocurrencies solana and XRP - to debut in early October.
"We've got about a dozen filings with the SEC now, and more coming," said Steven McClurg, founder of Canary Capital Group, a digital assets investment management firm that designs and launches ETFs. "We're all getting ready for a wave of launches."
Since the SEC first unveiled the proposed new listing standards in July, firms have scrambled to update their new product filings and respond to specific comments and questions from the SEC.
A final wave of amendments could be filed by the end of this week, said three people familiar with the matter, who asked not to be named.
"Those filings are pretty far along in the review process," said Teddy Fusaro, president of Bitwise, a crypto asset manager. "These are the rules we had been anticipating."
The SEC did not respond to a request for comment.
The vote last week by the SEC to adopt new listing standards eliminates the need for individual regulatory review of each crypto ETF application, allowing products that meet predetermined standards to launch without a lengthy case-by-case approval process. That will slash the approval time for new crypto products to 75 days or less, from up to 270 days previously, industry sources said.
The fourth quarter of 2025 is shaping up as boom time for crypto ETF issuers, said Jonathan Groth, a partner at DGIM Law.
Grayscale Investments was first out of the gate, rolling out its new Grayscale CoinDesk Crypto 5 ETF less than 48 hours after the SEC last week allowed its conversion from a private to publicly traded fund.
The Grayscale ETF owns bitcoin and ethereum, the two coins for which spot ETFs already exist, and also XRP, solana and cardano.
Peter Mintzberg, CEO of Grayscale, said its new ETF approval reflected Grayscale's advocacy for "public market access, regulatory clarity and product innovation."
SPEED TO MARKET
To benefit from the new, speedier process, an ETF must meet at least one of three principal criteria. If the coin underpinning the proposed ETF already trades on a regulated market or has futures contracts regulated by the U.S. Commodity Futures Trading Commission that have traded for at least six months, it qualifies.
Alternatively, the existence of another ETF tied to that coin that has at least 40 per cent of its assets invested in the cryptocurrency itself rather than options or swaps would open the door to approval.
The CFTC declined to comment.
"Not all of our existing filings qualify," said Kyle DaCruz, director of digital assets product at asset manager VanEck. "The next step is to talk to our lawyers to see which products can move forward and how rapidly will they get onto the market."
What remains unclear is the appetite for dozens of crypto ETFs on lesser-known coins and how they might fit into investor portfolios.
"There will be a flood of tokens that many folks have never heard of, and instead of years as with bitcoin, there will be weeks or months to provide that education," said DaCruz.
