Crypto ETP applications awaiting SEC approval are set to launch over 100 products in 2026, but many will face liquidation by 2027 due to insufficient demand, according to Bloomberg analyst James Seyffart. This surge follows new generic listing standards simplifying approvals for Bitcoin, Ethereum, and altcoin-based funds.
Over 126 crypto ETP applications are pending SEC review, targeting diverse assets like Solana and XRP.
Industry experts predict a wave of launches in 2026, expanding beyond spot Bitcoin and Ether ETFs that saw billions in inflows.
In 2023, 244 U.S. ETFs closed with an average age of 5.4 years, per Morningstar data, highlighting risks for underperforming crypto products.
Discover why crypto ETPs launching in 2026 may not last: Bloomberg insights on SEC approvals, market demand, and liquidation risks. Stay informed on Bitcoin, Solana trends—explore now for investment strategies.
What Will Happen to Crypto ETP Applications Awaiting SEC Approval in 2026?
Crypto ETP applications pending with the U.S. Securities and Exchange Commission are poised for a significant influx of approvals in 2026, potentially launching more than 100 new exchange-traded products. Bloomberg analyst James Seyffart forecasts that while this boom will diversify options beyond Bitcoin and Ethereum, many will struggle to attract investors and face closure by 2027. Factors like low assets under management, mirroring the 622 global ETF liquidations in the prior year, will drive this consolidation.
How Will the SEC’s New Listing Standards Impact Crypto ETP Launches?
The SEC’s adoption of generic listing standards in September has streamlined the approval process, eliminating case-by-case reviews for crypto ETPs and paving the way for mass filings. This shift enables faster market entry for products tied to assets like Litecoin, Solana, and XRP, which have already shown promise with recent launches amassing hundreds of millions in inflows. According to Farside Investors data, spot Bitcoin ETFs have drawn $57.6 billion since January 2024, while spot Ether ETFs reached $12.6 billion by July 2024, underscoring growing institutional interest. However, Seyffart warns that issuers are flooding the market with speculative offerings, including memecoin-based funds, which may not sustain demand. Expert analysis from Bitwise supports the over-100-launch prediction, but historical trends from Morningstar indicate that ETFs averaging 5.4 years often close due to insufficient inflows, with 189 U.S. closures last year alone. This regulatory evolution could expand crypto accessibility but risks oversaturation, as seen in early 2025 liquidations of ARK 21Shares funds like ARKY and ARKC, which failed to build meaningful assets under management.
Many of the crypto ETP applications awaiting SEC approval will launch in 2026, but a lot of those won’t survive beyond 2027, says Bloomberg analyst James Seyffart.
More than 100 crypto exchange-traded products are likely to hit the market in 2026, but many of them will quickly be shuttered due to a lack of demand, an analyst says.
Bloomberg analyst James Seyffart said on Wednesday that he agreed with a 2026 prediction from crypto asset manager Bitwise that over 100 crypto ETFs would launch, but said many wouldn’t last.
“We’re going to see a lot of liquidations in crypto ETP products. Might happen at [the] tail end of 2026 but likely by the end of 2027,” Seyffart said, adding that over 126 ETP applications are currently awaiting an outcome from the US Securities and Exchange Commission.
“Issuers are throwing A LOT of product at the wall.”
Last year, a total of 622 ETFs closed down, including over 189 in the US, The Daily Upside noted last month. Morningstar reported in January 2024 that the 244 ETFs that closed in the US in 2023 had an average age of 5.4 years.
Source: James Seyffart
Most of these investment products shut down because they failed to attract sufficient inflows, resulting in low assets under management.
Several crypto ETPs have already been liquidated this year, the most noteworthy were the ARK 21Shares Active Bitcoin Ethereum Strategy ETF (ARKY) and ARK 21Shares Active On‑Chain Bitcoin Strategy ETF (ARKC).
SEC’s listing standards to spur mass approvals
Industry analysts expect an explosion in the number of crypto ETPs approved in 2026 under the SEC’s new generic listing standards, which no longer require that each application be assessed on a case-by-case basis.
Even before the SEC’s generic listing standards came into effect in September, asset managers had filed to launch ETFs tied to increasingly speculative tokens, such as Melania Trump‘s memecoin.
ETFs tracking Litecoin (LTC), Solana (SOL), and XRP (XRP) launched with relative success this year, expanding from the Bitcoin (BTC) and Ether (ETH) ETFs that launched in 2024.
Spot Bitcoin ETFs in the US have accumulated $57.6 billion worth of inflows since launching in January 2024, while spot Ether ETFs have amassed $12.6 billion since July 2024, Farside Investors data shows.
Meanwhile, spot Solana ETFs from Bitwise, VanEck, Fidelity, 21Shares, Franklin Templeton, and Grayscale have seen $725 million since late October.
Frequently Asked Questions
What Are the Risks for Investors in New Crypto ETPs Launching in 2026?
Investors in new crypto ETPs launching in 2026 face risks of premature liquidation if products fail to draw sufficient inflows, similar to the 622 global ETF closures last year. Bloomberg’s James Seyffart highlights over 126 pending applications, many targeting niche assets that may not sustain demand amid market volatility.
Why Might Many Crypto ETFs Close by 2027?
Many crypto ETFs could close by 2027 due to low assets under management and insufficient investor interest, echoing the 244 U.S. ETF shutdowns in 2023 that averaged 5.4 years old, as reported by Morningstar. Analyst predictions point to oversaturation from streamlined SEC approvals driving rapid but unsustainable launches.
Key Takeaways
- Surge in Launches: Over 100 crypto ETPs are expected in 2026 under new SEC standards, building on Bitcoin and Ether ETF success with $70 billion in combined inflows.
- Liquidation Risks: Historical data shows many funds fail within five years due to low demand, with recent examples like ARK 21Shares ETFs already shuttered.
- Strategic Advice: Focus on established assets like Solana and XRP for potential stability; monitor inflows to avoid underperforming products.
Conclusion
The landscape for crypto ETP applications and their SEC approvals signals a transformative 2026, with mass launches diversifying investment options in Bitcoin, Ethereum, and altcoins like Solana. Yet, as Bloomberg analyst James Seyffart cautions, the SEC’s generic listing standards may lead to widespread liquidations by 2027 for those lacking demand. Investors should prioritize funds with strong inflow trends to navigate this evolving market, positioning themselves for long-term gains in the digital asset space.