Quick overview

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The Securities and Exchange Commission (SEC) has abruptly prevented Bitwise’s 10 Crypto Index Fund from becoming an exchange-traded fund (ETF), delaying investors’ access to XRP and other major altcoins.

 

This sudden and unexplained reversal in regulatory stance occurred just hours after the SEC’s Division of Trading and Markets initially approved the conversion. The recent SEC decision to halt Bitwise’s 10 Crypto Index Fund’s conversion to an ETF surprised the cryptocurrency investing community.

The approval by the division happened without public explanation, fueling rumors about the regulatory environment for cryptocurrency ETFs. This situation highlights the ongoing challenges crypto asset managers face when trying to launch spot-based altcoin ETFs in the US. It shows that the SEC is adopting a cautious stance, despite its recent pro-crypto rhetoric.

The SEC’s move to stop Bitwise’s ETF conversion has significant implications for the broader altcoin ETF market. XRP, which is under legal scrutiny, remains a source of regulatory uncertainty. Industry insiders note that although approval is not expected until late 2025, the SEC is reportedly developing a new universal listing framework that could expedite approvals for spot-based altcoin ETFs.

Investors mainly have access to leveraged and futures-based ETFs for XRP and Solana (SOL), which carry different risks compared to spot ETFs. This regulatory uncertainty limits opportunities for direct exposure and could delay institutional adoption of ETFs for altcoins.