October was anticipated to be a significant month for cryptocurrency enthusiasts, as it marked the potential launch of multiple long-awaited crypto exchange-traded funds (ETFs) in the U.S. Financial markets were set for several crucial deadlines regarding the Securities and Exchange Commission’s (SEC) approval or denial of various spot crypto ETF applications. However, the unexpected government shutdown led to a halt in this process, rendering those deadlines moot.
As attention shifts to November, several issuers are exploring a procedural avenue that circumvents the immediate need for SEC sign-off. This method, which previously enabled four crypto ETFs—two from Canary Capital, one from Bitwise, and one from Grayscale—to commence trading earlier this week despite regulatory uncertainties, appears to be gaining traction.
The issuers are updating their S-1 registration statements to include “no delaying amendment” language. This stipulation under U.S. securities law means that these filings automatically become effective after 20 days unless the SEC intervenes to impose a stay or request alterations. In the cases of the ETFs that launched earlier this week, the SEC did not take action, allowing them to go live by default.
This newfound approach has sparked a flurry of additional filings, with Fidelity recently submitting an updated S-1 for its spot Solana ETF and Canary Capital filing a similar update for its XRP ETF. Should the SEC maintain its current course without intervening, the market could see the introduction of its first XRP fund as early as November 13.
Nevertheless, there are limitations to this workaround. While the SEC has engaged in prior reviews of filings tied to other cryptocurrencies like Solana, HBAR, and Litecoin, it has not actively participated in the review process for the XRP application. This gap raises concerns that the agency might intervene to halt automatic approvals.
James Seyffart, an ETF analyst at Bloomberg Intelligence, noted the potential for a series of funds to launch as early as next month, regardless of whether the government reopens. However, he cautioned that not all filings have received SEC feedback, which could impede the launch of certain funds if the government does not return to normal operations.
This development signifies a pivotal moment in the ongoing quest to establish crypto ETFs in U.S. markets. Rather than waiting on formal approval from the SEC, issuers are leveraging procedural mechanisms to advance their market positions. The extent to which this momentum continues into November may ultimately hinge less on the market’s readiness and more on the resumption of governmental operations.
