SEC Delays Its Decision on Polkadot & HBAR ETFs
- The SEC has pushed back decisions on Polkadot and HBAR ETFs to June.
- A total of 72 crypto ETF applications are said to now await regulatory review.
- New SEC leadership may reshape the crypto fund landscape.
The Securities and Exchange Commission has extended its review period for multiple cryptocurrency exchange-traded funds, adding to a mounting backlog of applications as the agency navigates an unprecedented wave of crypto fund proposals.
According to regulatory filings posted Thursday, the SEC postponed decisions on Grayscale's Polkadot Trust conversion and Canary Capital's HBAR ETF until June 11, while Bitwise's joint Bitcoin-Ethereum ETF review was extended to June 10.
In the filings, the Commission wrote that it "finds it appropriate to designate a longer period within which to take action on the proposed rule change so that it has sufficient time to consider the proposed rule change and the issues raised therein."
Bloomberg analyst Eric Balchunas recently highlighted an unprecedented scenario in which 72 crypto ETF applications are now awaiting SEC decisions under newly-sworn Chairman Paul Atkins. The agency's handling of this growing backlog will likely determine which digital assets beyond Bitcoin and Ethereum become accessible to mainstream investors.
The current wave of applications highlights the expansion of the crypto ETF ecosystem beyond just spot Bitcoin ETFs like the iShares Bitcoin Trust (IBIT). Fund issuers are now pursuing approval for products tied to cryptocurrencies ranging from XRP and Litecoin to Solana and Dogecoin.
New Leadership, New Approach
The review extensions follow several months of changing regulatory dynamics in the crypto space. Since March, the SEC has dropped enforcement actions against numerous crypto companies, including Kraken and Coinbase. The agency has also dismissed investigations into OpenSea and Robinhood's crypto unit.
The decision delays coincide with leadership changes at the SEC. Chairman Atkins, who took office earlier this month, brings a reputation for favoring less restrictive regulatory approaches.
U.S. lawmakers introduced a stablecoin bill to boost dollar dominance, potentially signaling a move toward increased regulatory clarity surrounding digital assets. This legislative activity, coupled with the SEC's enforcement retreat, suggests a shifting regulatory landscape for crypto investments.
Bitcoin and Ethereum funds gained approval after years of regulatory resistance, but uncertainty persists regarding how smaller cryptocurrencies with less established markets will be evaluated under different regulatory frameworks.
