The U.S. Securities and Trade Fee probably halted the launch of the Grayscale Digital Massive Cap Fund (GDLC) for administrative causes, not political ones, a number of people conversant in the matter informed CoinDesk.
The SEC permitted GDLC to uplist as an exchange-traded fund (ETF) on Tuesday by means of staffers’ delegated authority, that means the regulator’s commissioners didn’t need to vote on the appliance. However, the regulator knowledgeable Grayscale and the New York Inventory Trade — GDLC’s itemizing associate — on Wednesday that the SEC’s commissioners will assessment the approval, pausing GDLC’s go-live date within the meantime.
GDLC is predicated on CoinDesk Indices’ CoinDesk 5 Index.
Halting the launch offers the SEC time to develop itemizing requirements for different ETFs that may launch beneath the identical mechanism, the people stated.
There’s additionally the truth that GDLC incorporates two digital belongings — XRP
and Cardano — that do not presently have their very own particular person ETFs. Two of the opposite belongings within the basket, Bitcoin and Ethereum , have had their very own ETFs since 2024, and the SEC has even beforehand okayed funds containing each of these belongings. Solana additionally noticed its first ETF launch earlier this week, although purposes for different ETFs tied to the asset stay beneath SEC assessment.
The SEC faces deadlines later this yr for the XRP, ADA and SOL purposes.
James Seyffart, Bloomberg Intelligence ETF analyst, informed CoinDesk that the SEC’s pause was “not regular.” In a publish on X, he wrote that there are two potential causes behind the transfer.
“The SEC does not need to let something to launch beneath the 19b-4 course of till they formally approve or give you some framework for digital belongings within the ETF wrapper.” The opposite possibility, he wrote, is that the SEC desires to work on one thing in relation to a particular side of the fund itself, for instance the construction.
In an announcement, a Grayscale spokesperson stated the SEC’s pause “was surprising” however “displays the dynamic and evolving nature of the regulatory panorama surrounding a first-of-its-kind digital asset product like GDLC.”
“Grayscale stays dedicated to pursuing the itemizing of GDLC as an ETP and we’re working intently with key stakeholders to fulfill all mandatory necessities. We are going to present additional updates as extra info turns into obtainable,” the spokesperson stated.
An 8-Okay submitting from Grayscale stated the agency “stays dedicated to pursuing the itemizing of the Fund on NYSE Arca and continues to work intently with key stakeholders to acquire approval of the appliance.”
