Crypto Firms Urge SEC to Expedite ETF Approval

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Crypto Firms Urge SEC to Expedite ETF Approval

Grayscale, 21Shares, a16z urge SEC to speed up ETF reviews.

Grayscale, 21Shares, a16z, and others have called on the U.S. Securities and Exchange Commission (SEC) to expedite the review of ETFs and amend the registration process.

In a public comment on future regulations, Grayscale suggested allowing confidential submission of draft documents for exchange-traded products before public disclosure. The company believes this would reduce the incentive for competitors to copy or duplicate applications.

Grayscale also demanded that SEC staff respond to requests within 45 days.

21Shares made similar proposals. Previously, the Commission had asked market participants whether artificial intelligence contributes to multiple nearly identical applications for “new” ETFs.

a16z also urged for shorter review periods, citing electronic document submission, the template nature of disclosures, and the repetitive nature of questions from product to product.

However, a16z emphasized that speeding up the process should not mean less thorough scrutiny.

Opposition

Representatives from Jane Street, on the other hand, warned that the race for speed could lead to hasty registrations and reduce the time for feedback from market makers on fund structure and liquidity. The company suggested launching such products with at least two authorized participants.

Charles Schwab opposed a fully confidential procedure. If the SEC does discuss an application with the sponsor privately, the document should be made public at least 75 days before it takes effect, according to the company.

Other Initiatives

Some participants proposed broader ideas for crypto funds. Multicoin Capital suggested allowing the use of liquid staking tokens in spot crypto-ETPs—even to the extent that they make up nearly the entire volume of digital assets in the product.

Jito Labs, Jito Foundation, and Solana Policy Institute, in a joint response with Multicoin, called on the SEC to establish rules for the use of staking assets in spot crypto products.

The NYSE requested that the review periods for new products be made more predictable. According to their assessment, regulators can ask the exchange to delay listing during the review process without providing clear timelines, even if another exchange is undergoing a similar process.

Comments on the SEC’s request were due by August 31, but the regulator continued to publish materials dated later. The Commission has not yet outlined a further course of action.

In August, the regulator introduced new rules for the crypto market. The project, titled Regulation Crypto Assets, simplifies capital raising through tokens and provides a “safe harbor” for certain digital assets.

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Source: forklog.com