New Generic Listing Standards for Crypto ETFs From the SEC Could Speed Up ETF Approvals

In a groundbreaking moment for the cryptocurrency market, the United States Securities and Exchange Commission (SEC) has announced that it has greenlit new generic listing standards for spot crypto exchange-traded funds (ETFs). 

Crypto ETFs Could Get Faster Approvals With New Listing Standard

The SEC, on Wednesday, September 17, announced that new generic listing standards for spot crypto ETFs for commodity-based trust shares on Nasdaq, Cboe, and the NYSE have been approved. With this approval, these exchanges can now list crypto ETFs without the regular ETF waiting process.

This new structure will do away with the case-by-case 19b-4 process allowing the entry of multiple digital asset ETFs into the market within a few weeks. The SEC filing process for spot ETFs has now been streamlined under Rule 6c-11, which will significantly reduce the time taken for approval.

This is a huge win for the crypto market, as previously, some crypto ETF applications had to wait for up to 240 days before approval. With the acceptance of these generic listing standards, SEC Chair Paul Atkins said in another statement that the regulator is confident that their capital markets will continue to be known for having the best innovation in the world for digital assets.

Quicker approval times could lead to more innovative applications for crypto investment products. This falls in line with the push from the President Donald Trump administration to establish America as the crypto capital of the world. 

SEC Shares Clear Requirements for Crypto ETF Listing

Along with approving generic listing standards, the regulator also shared requirements for a crypto ETF filing. To be eligible for listing on any of the top exchanges, a crypto spot ETF must satisfy a minimum of six months of existence on a commodity that is listed on a market covered by the Intermarket Surveillance Group with access to surveillance.

The crypto ETF may also trade a futures contract, which is listed on a specified contract market and has a surveillance-sharing arrangement in place. Alternatively, it can qualify provided that it is already included in an ETF with no less than 40% exposure listed on a national securities exchange, the securities regulator said.

When a rule filing is submitted by an exchange to list and trade crypto exchange-traded products that do not comply with the approved generic listing standards, the SEC will require a rule filing.

A Wave of New Crypto ETFs Could Hit the Market

The new listing standard, which will lead to shorter waiting times for the approval of crypto ETFs, comes when there has been a barrage of ETF applications for several cryptos. In recent months, there have been multiple applications for spot ETFs for Solana, Dogecoin, Cardano, Litecoin, XRP, and others. 

For many of these ETF applications, the SEC was facing a deadline of October for their approval. With the new standard in place, the ETF analyst, James Seyffart, has said that this is the framework the industry has been waiting for. 

The analyst has predicted that a wave of new crypto investment products will hit the U.S. market in the next few weeks. Many crypto enthusiasts are keenly anticipating the next few weeks, as several communities have had to wait for months for their ETF approval.