SEC Simplified Review of Crypto ETF Registration Applications after Shutdown

• The SEC has paved the way for an accelerated launch of crypto ETFs.
• Eric Balchunas expects that the Bitwise XRP-ETF could be the next fund to be launched.
• The document published by the Commission clarified the procedure for processing more than 900 applications received during the shutdown.

Bloomberg analyst Eric Balchunas drew attention to a new clarification from the US Securities and Exchange Commission (SEC), which opens up the possibility for issuers to accelerate the effective date of their registration statements — provided they meet certain technical requirements. This should help unblock the huge backlog of documents that has accumulated during the US government shutdown.

On November 13, the Commission published recommendations related to the government shutdown. In the document, it explained how it would process the more than 900 applications submitted during the suspension. Among the key points:

• If an issuer removes the deferral of amendment option during the shutdown or files a new form without it, the registration will automatically become effective in 20 days under Item 8(a)
• The SEC will not require any further action even if the document omits information under Rule 430A
• Companies that want to accelerate the effective date can add a deferral of amendments and request expedited filing under Rule 461
• Forms filed during the shutdown will be reviewed on a first-come, first-served basis, and the SEC will automatically declare previous graduated amendments effective unless the issuer requests a delay

Thus, the new technical clarification allows cryptocurrency ETFs that have been delayed by the SEC shutdown to move forward more quickly.

As a reminder, the shutdown lasted from October 1 to November 12 and became the longest in US history with 43 days.

It led to a delay in the launch of cryptocurrency funds that were supposed to debut in October. At the same time, issuers started using the automatic approval mechanism — updated S-1 forms without a delayed amendment, which become effective in 20 days if the SEC does not have time to object.

This approach has already allowed several new funds to enter the market in November, including Canary Capital, Bitwise, and Grayscale.

And on November 13, the US market was replenished with another product — a spot XRP-ETF from Canary Capital, the listing of which Nasdaq agreed with the SEC, also using the automatic approval mechanism.