tl;dr
The US Securities and Exchange Commission (SEC) has officially begun the review process for Grayscale's Digital Large Cap Fund to become an Exchange-Traded Product (ETP) by publishing the 19b-4 filing in the Federal Register. This marks the first time a national securities exchange would list and tr...
The US Securities and Exchange Commission (SEC) has initiated the review process for Grayscale's Digital Large Cap Fund to become an Exchange-Traded Product (ETP) by publishing the 19b-4 filing in the Federal Register. This marks a potential shift in the SEC's approach to ETPs beyond Bitcoin and Ethereum, with implications for other crypto assets.
Grayscale's filing signifies the expansion of the SEC's consideration beyond Bitcoin and Ethereum, with implications for the status of other cryptocurrencies. The fund holds over $530 million in assets and includes Bitcoin, Ethereum, Solana, XRP, and Avalance. The SEC has not yet responded to similar ETF applications for Solana and XRP.
Grayscale announced in a press release that the US SEC has published the NYSE Arca’s 19b-4 filing to list and trade its Digital Large Cap Fund as an Exchange-Traded Product (ETP) in the Federal Register, formally initiating the review process for the Commission to review and possibly approve the application. The review process can take up to 240 days before the regulator must decide whether to approve or deny the application.
If the US SEC approves the NYSE Arca’s proposed rule change, it would be the first time a national securities exchange would list and trade shares of multi-crypto asset ETPs.
Grayscale noted that the NYSE Arca’s proposed rule change aims to revise how the exchange defines ETPs that hold commodities and digital assets beyond Bitcoin and Ethereum. Therefore, the SEC’s comments on the application would be worth keeping an eye on, especially considering that the Commission has doubts about the non-security status of other cryptos besides Bitcoin and Ethereum.
The SEC has yet to react to Van Eck’s and 21Shares’ Spot Solana ETF applications, which indicates that it still believes SOL is a security. Meanwhile, the Commission has yet to react to the XRP ETF filings from Bitwise and Canary Capital. 21Shares also recently joined the XRP ETF race last week when they filed the form S-1 for their XRP ETF with the US SEC.