SEC Clarifies Rules to Speed Crypto ETF Approvals

Bloomberg analyst Eric Balchunas highlighted a new clarification from the U.S. Securities and Exchange Commission (SEC) that may allow crypto ETF issuers to accelerate the effective date of their registration statements, provided they meet several technical requirements.

This update could help clear the enormous pile of filings accumulated during the 43-day U.S. government shutdown, which left more than 900 applications waiting for review.

Balchunas believes several crypto ETFs may act quickly:

Shutdown Backlog and New Technical Rules Explained

On November 13, the SEC published detailed guidance outlining how it would process the flood of filings submitted during the shutdown. The key clarifications include:

• Automatic 20-day effectiveness for forms filed without a deferral during the shutdown, under Section 8(a).
• No additional SEC action required even if the filing lacks Rule 430A information.
• Issuers may add an amendment deferral and request acceleration under Rule 461 if they want faster approval.
• Filings will be reviewed in the order they were received, and the SEC will automatically declare prior post-effective amendments effective unless an issuer requests a delay.

Shutdown Delays and the Push for Automatic Approvals

The shutdown, lasting from October 1 to November 12, became the longest in U.S. history.

It halted the launch of multiple crypto ETFs that were expected to go live in October. In response, issuers began taking advantage of the automatic approval mechanism: submitting S-1 forms without a deferral, which automatically take effect after 20 days if the SEC does not object.

This approach has already enabled multiple new funds to enter the market in November, including products from Canary Capital, Bitwise, and Grayscale.

On November 13, the U.S. market expanded again with another launch: Canary Capital’s spot XRP ETF, approved by Nasdaq and the SEC using the same automatic pathway.

As the SEC clears its backlog and issuers accelerate their filings, the pace of new crypto ETF launches in the U.S. may soon increase significantly.