Canary Capital and Bitwise Asset Management are launching the first U.S. exchange-traded products (ETPs) tied to altcoins. These include litecoin (LTC), hedera (HBAR), and solana (SOL). Despite the U.S. government shutdown, the firms are moving forward. The SEC’s review process for new ETFs has been delayed. However, Canary Capital and Bitwise are still on track to launch their cryptocurrency products on Tuesday.
Launching Amid SEC Delays
The SEC’s recent mid-September vote has provided the green light for national securities exchanges to adopt generic listing standards for cryptocurrency ETPs. This change eliminates the need for lengthy, product-specific reviews, streamlining the approval process for future launches. Canary Capital, which has worked closely with the SEC throughout the past year, was prepared for this launch well before the shutdown occurred.
“We’ve had several interactions with the SEC,” said Steven McClurg, CEO of Canary Capital. “We were very much ready to go before the shutdown.” This marks a key moment for cryptocurrency ETFs in the U.S., as they are expanding beyond Bitcoin and Ethereum to include altcoins like Litecoin and Hedera. Bitwise will also launch its Solana ETF on the same day, marking the first time U.S. investors will be able to invest in these altcoins via an ETF.
Impact of the SEC Shutdown
While the SEC’s shutdown has delayed many routine filings and approvals, including those for crypto ETFs, Canary and Bitwise are proceeding with their launches under the new, more flexible listing rules. The shutdown has paused the SEC’s standard review process, affecting the approval timeline for a range of financial products, including cryptocurrency ETFs. The SEC has continued to operate with minimal staff, focusing only on critical matters like fraud investigations.
Despite the uncertainty, the new rules passed by the SEC allow crypto ETPs to go to market without needing an individual, product-specific review. Instead, asset managers need to ensure their products meet certain basic criteria. This significant shift opens the door for more crypto ETFs, especially those tied to smaller, emerging cryptocurrencies.
A New Era for Cryptocurrency ETFs
The introduction of Litecoin and Hedera ETPs by Canary Capital, alongside Bitwise’s Solana ETF, represents a major milestone in the crypto market. These are the first ETFs for altcoins beyond Bitcoin and Ethereum in the U.S., signaling the potential for a wider range of cryptocurrency products to enter the market. The new framework should streamline approval processes for many firms that are looking to offer similar products.
Dave Nadig, head of research at ETF.com, emphasized the importance of these new standards. “The standardized listings give the whole industry plenty of room to roll out these new products,” he explained. However, while these initial launches are moving forward, some additional filings from Canary Capital are still awaiting approval, with the company rolling them out in stages.
