The crypto industry is stunned by the SEC's decision to suspend trading of the multi-asset Grayscale ETF, which contains Solana and XRP. This decision comes as a surprise following the fund's recent approval.
Suspension of Grayscale ETF Trading
On Thursday, the SEC suspended trading of Grayscale’s multi-asset GDLC ETF, which includes Solana and XRP. This decision was described by Grayscale as "unexpected" and reflects an increasingly unstable regulatory environment in the US. The ETF, which was recently approved for listing on NYSE Arca, mainly consists of Bitcoin and Ethereum, but it is the exposure to altcoins that seems to be problematic for the regulator.
SEC's Strategy Towards Altcoins
Some analysts believe that the SEC is taking an extremely cautious stance toward altcoins, aiming to avoid any risks associated with these controversial assets. However, other observers suggest that this temporary suspension could represent a more strategic maneuver: by approving the fund while blocking its launch, the SEC would allow itself to monitor market reactions while demonstrating regulatory vigilance.
Regulatory Prospects for Crypto ETFs
The suspension raises questions about the maturity of altcoins like Solana and XRP for full integration into ETFs intended for the general public. The necessity of a transitional phase for such assets has become more pressing. This situation could accelerate the long-awaited clarification process, as uncertainties regarding the status of altcoins continue to create instability in the market and could affect the future of over 70 crypto ETFs currently awaiting SEC approval.
In the meantime, the suspension of Grayscale’s ETF showcases the contradictions within the American crypto regulatory landscape, leaving the market awaiting further actions from the SEC.
