(Bloomberg) -- Donald Trump’s pick to succeed Gary Gensler as chair of the SEC hasn’t been officially installed yet, but the regulator is already taking incremental steps on a path to approving a handful of new cryptocurrency exchange-traded funds.
On Thursday, the US Securities and Exchange Commission said its seeking public comments on Grayscale’s Solana and Litecoin exchange-traded products, according to two filings. Industry observers say it’s an encouraging sign and change of pace from the agency, which previously had not acknowledged filings for ETFs that track the spot price of Solana, one of the largest cryptocurrencies behind Bitcoin and Ether. The SEC began to seek comment for another Litecoin ETF in January.
“The mere acceptance of the filings into the review process - which is what happened this week - indicates that their view is already changing,” said Teddy Fusaro, president at Bitwise, which has also filed for a Solana ETF. “Just a few months ago, they wouldn’t review them at all, and now they have officially taken them into the review process.”
Ever since Trump won the US election, exchange-traded fund issuers have flooded the SEC with filings to launch products that hold ever more creative crypto offerings, in the hopes that the president’s embrace of the industry will embolden the SEC to take a friendlier approach to the sector. Trump’s SEC Chair nominee, Paul Atkins, hasn’t yet been confirmed by Congress.
Issuers have now proposed products that will do everything from go all-in on a Trump memecoin to track tokens like Dogecoin. Earlier this week, Trump Media & Technology Group Corp. applied to trademark brands for six investment products, including three ETFs, with themes that closely track Trump’s priorities in office.
In addition to seeking public comments on Grayscale’s two altcoin fund filings, the regulator said Thursday its seeking comments on whether or not to allow for in-kind creations and redemptions on BlackRock’s iShares Bitcoin Trust ETF.
The latest moves from the regulator are by no means an approval of the products, which could take months. In addition, the SEC has not yet been clear on laying out which underlying crypto assets in existing filings are securities. The current Solana filings the SEC is accepting comments on treat the token like a commodity.
“Clearly, the Gensler SEC thought everything was a security. Atkins has not yet been installed, so the SEC is still in a bit of an interregnum,” said Jim Angel, an associate professor at Georgetown University’s McDonough School of Business. “With respect to the Solana ETF: The NYSE could be testing the waters by forcing the SEC to make a decision on this.”
--With assistance from Emily Nicolle.
