The delay is not a rejection but a temporary setback, leaving the crypto community in anticipation for clarification.
Despite approving Grayscale’s new five-asset basket ETF yesterday, the SEC issued a stay order on it. This prevents the product from going to market for an indefinite period.
Prominent ETF analysts have issued a few competing theories to explain this delay, but these only constitute educated guesses. Until the SEC clarifies its position, we’re all in the dark.
Grayscale has been a crypto ETF pioneer since it spearheaded the approval of a Bitcoin ETF, and the firm has filed for several other new products since.
Yesterday, the SEC caused a huge stir when it approved a new basket ETF, consisting of five leading altcoins. However, the Commission has apparently reversed this stance, inviting confusion:
“The Commission will review the delegated action. In accordance with Rule 431(e), the July 1, 2025 order is stayed until the Commission orders otherwise. The Office of the Secretary will notify you of any pertinent action taken by the Commission,” the SEC claimed in a letter addressed to the NYSE.
To be clear, this isn’t a full rejection for Grayscale’s ETF. Instead, the company is merely delaying its official launch for an indefinite period. It’s a frustrating situation, but this doesn’t signify a greater anti-crypto stance from the SEC.
Naturally, the crypto community has been speculating why the Commission changed its stance on Grayscale’s new ETF. The SEC has taken a firmly pro-crypto stance in recent months, but it’s given ETF proposals one delay after another.
There are several outstanding questions regarding SEC and CFTC jurisdiction over altcoins within Grayscale’s ETF. The Commission may want to resolve these issues before pushing a full launch.
Furthermore, he stated that today was the final deadline for Grayscale’s ETF application. The SEC may have employed this unorthodox strategy as a way to push the envelope a little further.
Under this view, the Commission didn’t want to deny Grayscale, so it opted to issue a false approval to buy time. Seyffart also thought that it could be a specific issue with Grayscale.
Other analysts echoed this first sentiment. The SEC is currently formulating new standards to streamline ETF approvals, but they aren’t ready yet. It may wish to hammer out all the relevant details before letting Grayscale take its ETF to market.
Unfortunately, this is all just speculation. Until the Commission issues further guidance, it’ll be impossible to definitively explain this move. Hopefully, the SEC will clarify its position soon, and Grayscale’s new ETF will hit the market.
