Bloomberg Analyst Shares Timeline On SOL, XRP, LTC, HBAR ETFs’ Approval

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As a seasoned crypto investor with a decade of experience under my belt, I find James Seyffart’s analysis both enlightening and slightly frustrating. It’s encouraging to see the progress being made towards altcoin ETFs, but the timeline for approval seems to stretch well into 2025.

James Seyffart, an analyst from Bloomberg, has provided estimated timeframes for the possible authorization of Exchange-Traded Funds (ETFs) based on Solana (SOL), XRP, Litecoin (LTC), and Hedera (HBAR). As regulatory deliberations gather momentum in the U.S., Seyffart anticipates that judgements regarding these cryptocurrency ETFs could stretch into late 2025, subject to a range of influencing factors.

Bloomberg Analyst Shares Timeline On Altcoin ETFs’ Approval

James Seyffart, an analyst at Bloomberg, explains that the situation regarding altcoin Exchange-Traded Funds (ETFs) remains unclear due to past SEC decisions. The approval for Bitcoin and Ethereum ETFs was primarily because they are linked with futures markets regulated by the CME. However, many altcoins like SOL and XRP lack these regulated futures markets, which might slow down the process of ETF approval.

According to Seyffart, due to the lack of a substantial, regulated market, the SEC has typically rejected proposals for altcoin ETFs. However, he pointed out that a change in SEC leadership in 2025 might adjust these rules, but the timeline for approval remains uncertain.

Seyffart pointed out that while companies such as WisdomTree and 21Shares have recently sought approval for XRP ETFs, the existing regulations prohibit their launch at this time. Various challenges must be addressed first, including concerns about market manipulation, safekeeping, and compliance, before these products can be made available.

XRP ETF Applications and Staking in ETFs

As a researcher delving into the world of cryptocurrencies, I find the recent XRP ETF filings, particularly the WisdomTree XRP Fund, to be an encouraging stride for altcoin ETFs. The submission of this fund’s registration in Delaware suggests a forthcoming formal S-1 filing with the United States Securities and Exchange Commission (SEC).

According to analyst James Seyffart from Bloomberg, incorporating staking for cryptocurrencies like Ethereum, Solana (SOL), and Ripple (XRP) might be a crucial aspect of future Exchange-Traded Funds (ETFs). However, he pointed out that the current regulations do not allow for staking within ETF frameworks.

If a future U.S. Securities and Exchange Commission (SEC) administration becomes more favorable towards cryptocurrencies, it’s possible that staking might be permitted as early as 2025. This implies that the increased availability of staking could potentially boost interest in related products.

Filing Timelines and US SEC Approval Process

James Seyffart, an analyst at Bloomberg, has explained that there are two significant methods for registering Exchange-Traded Funds (ETFs): the 19b-4 rule submissions to the Securities and Exchange Commission’s (SEC) Division of Trading Markets, which initiates a formal review period with specific deadlines, contrasted with S-1 prospectuses that do not have predefined timelines.

It was observed that Bitcoin and Ethereum ETFs are moving forward in the 19b-4 process, whereas the majority of other altcoins have yet to initiate this process. As a result, there’s no set timeline for their regulatory approval at this time.

According to Seyffart, if the application for an altcoin ETF starts the 19b-4 procedure today, a decision might not be made until as late as the end of 2025.

The analyst mentioned that potential leadership shifts at the SEC might influence the pace at which approvals are given. If a new SEC chair is appointed under a pro-cryptocurrency government, the process could speed up significantly, though the exact degree of change is still unclear.

The Role of Index and Basket ETFs

James Seyffart, an analyst at Bloomberg, also discussed the potential introduction of diversified index Exchange-Traded Funds (ETFs), such as those that invest in assets like Bitcoin, Ethereum, Solana, and Ripple. Notably, funds like Grayscale’s GDLC and Bitwise’s Crypto 10 Index, which have applied for ETF conversion, might experience less impact from regulatory issues due to their substantial exposure to Bitcoin and Ethereum.

The main regulatory issues surrounding altcoins in these index ETFs might be addressed if a significant portion of the fund’s investments is kept in Bitcoin and Ethereum. Nevertheless, the approval from the SEC for these products will probably hinge on whether they deem the smaller altcoin holdings to comply with current regulations.

Seyffart expressed cautious optimism about the potential approval of altcoin ETFs, acknowledging that the SEC’s new administration would ultimately make the decision. In his opinion, key decisions regarding ETFs for XRP, SOL, LTC, and HBAR might be made as late as 2025. However, the regularity of these decisions will hinge on modifications in leadership and broader fluctuations within the regulatory landscape.

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2024-11-25 23:06