The U.S. Securities and Exchange Commission (SEC) is poised to update its listing rules in a way that could significantly impact the cryptocurrency exchange-traded fund (ETF) landscape. According to Bitwise Asset Management, these proposed changes aim to address long-standing regulatory hurdles and bring greater clarity to the approval process for crypto-based investment products. While this development is viewed as a positive step for the industry, analysts caution that it does not necessarily guarantee increased inflows for crypto ETFs.

Bitwise Chief Investment Officer (CIO) Matt Hougan stated that the SEC's plan to develop generic listing standards for crypto exchange-traded products (ETPs) could trigger an end-of-year rally for the crypto market. Hougan believes the SEC's upcoming generic listing standards could unleash a surge of new crypto ETFs. He noted that crypto ETPs tracking Solana, XRP, Avalanche, Cardano, and Chainlink, among others, could soon be available.

Hougan's memo outlines a shift from case-by-case approvals to rules that could greenlight compliant filings within 75 days, provided an asset has futures trading on a regulated U.S. exchange such as CME, Cboe, or Coinbase Derivatives Exchange. That template could unlock spot ETPs tied to solana, XRP, chainlink, cardano, avalanche, polkadot, hedera, dogecoin, shiba inu, litecoin, and bitcoin cash.

Bitwise, a leading provider of crypto indices and investment products, emphasized that the revised listing rules could help streamline the approval process and reduce the likelihood of arbitrary rejections. The firm noted that the SEC's approach has previously lacked consistency, which has discouraged institutional investors from committing to the asset class. The new rules, if implemented, could reduce uncertainty for both issuers and investors by setting clearer expectations for compliance and documentation.

Hougan compared the potential impact to the 2019 "ETF Rule," which tripled traditional ETF launches, and argued that easier access will position crypto assets for stronger rallies when their fundamentals improve. Hougan called the change a "coming of age" moment.

Despite these regulatory improvements, Bitwise highlighted that structural challenges remain within the market. These include volatility in crypto prices, limited trading infrastructure, and the lack of a clear regulatory framework for spot crypto ETFs. While the proposed changes may remove one barrier, they do not address the broader market risks that could still deter inflows into crypto ETFs.

Hougan added that the launch of a crypto ETP does not ensure demand, citing Ethereum funds, which saw little inflows following their debut in June 2024. The spot ethereum ETPs launched in June 2024 drew meaningful assets only months later, when interest in stablecoins and tokenization picked up. Hougan's memo says products follow demand; they don't create it. What generic standards do is strip friction. Allocators can buy a ticker rather than wrangle wallets and exchanges, making it easier to act when fundamentals improve. The visibility may also normalize crypto for investors who start seeing tickers next to familiar funds.

The potential for a successful crypto ETF launch has remained a focal point for both investors and regulators. Several applications have previously been rejected, with the SEC citing concerns over market manipulation and investor protection. Bitwise indicated that the updated rules could provide a more level playing field for applicants, but emphasized that the final outcome will depend on how the agency interprets and enforces the new standards.

According to Hougan, the SEC's move to adopt generic listing standards represents a “coming of age” moment for the crypto industry. It signals that crypto is finally reaching mainstream acceptance and becoming an integral part of global financial markets.

Bitwise has filed with the US Securities and Exchange Commission (SEC) to launch the “Stablecoin & Tokenization ETF,” an exchange-traded fund designed to track an index split between companies tied to stablecoins and tokenization.