Key dealers
- Vaneck, 21Shares and Canary Capital urges SEC to return to its “first-to-to-approwve” standard for crypto ETP approvals.
- Simultaneous approvals are said to stifle innovation and disadvantages smaller ETF companies.
Three asset managers-Vaneck, 21Shares and Canary Capital-Har signed a letter that invites Sec to restore its traditional standard for “first to file, first to approval” for exchange traded products.
The letter, Published In Vaneck’s official X account on June 6, concerns about the latest deviation from its traditional practice to approve ETPs in the order they were submitted.
The Commission has adopted a simultaneous approval process, which according to the fund managers has disadvantaged smaller companies and suffocated innovation of $ 15.4 trillion US ETF market.
“When the Commission plays favorites, it costs ETP sponsoring money and makes the ETP market less fair,” the companies said in their joint letter.
The companies listed the launch of Bitcoin Futures ETF at the end of 2021, where Proshares secured over 90% of market shares with only a three-day lead.
They also pointed out on January 10, 2024, at the same time approval of Tot Bitcoin ETP, where they say that the largest companies have received dominant market shares despite being submitted later than others.
“This significant displacement of regulation away from a first to felt approval principle affects market dynamics in several critical ways,” the letter said. “It stimulates replication rather than original innovation and thus discourages the significant investment required to develop truly innovative products.”
In January 2024, Sec approved all 11 Spot Bitcoin ETFS simultaneously and disregarded the order in which the issuers had submitted their applications.
A few months later, the controller followed the same approach with Spot Ethereum ETFs, which granted joint approval for all active applications regardless of submission timing.
Vaneck and 21Shares were among the earliest companies that applied for both Tot Bitcoin and Ethereum ETFS and played a groundbreaking role to gain exposure to digital access to the US market.
Following these milestone approval, both companies, together with Canary Capital, move quickly to lead the next wave of applications for alternative Crypto Asset ETFs.
Canary Capital, in particular, made an early pressure into the Altcoin ETF space and sent suggestions to a stacked throne etfThe A Cronos ETFAnd other niche crypto products.
However, despite early efforts from these issuers, the Sec’s latest precedent suggests that at the same time approval, rather than first to felt prioritization, may again be the result, if the Commission would decide that Greenlight further crypto ETPs.
In recent weeks, SEC has delayed decisions on several Altcoin ETF applications, including those tied to Solana, XRP and Litecoin, among others.
Bloomberg Intelligence The latest forecasts place approval odds for Litecoin and Solana ETFs at 90% this year, with XRP ETFs not long after at 85%.
