SEC Delay Puts Spotlight on Pending Spot XRP ETF Approvals

Spot XRP ETFs cannot begin trading until the SEC’s Division of Corporation Finance declares their registration statements effective.

The SEC’s reduced operations during the government shutdown have delayed reviews of spot crypto ETF applications from leading asset managers.

Several major XRP ETF filings from Grayscale, 21Shares, Bitwise, and others face crucial deadlines in the coming weeks.

Spot crypto exchange-traded funds are facing delays as the United States Securities and Exchange Commission has yet to grant final approval. Market reporter Eleanor Terrett clarified that the SEC’s Division of Corporation Finance must issue the final authorization before any spot ETF can launch. The agency’s limited operations during the government shutdown have further slowed progress, holding back anticipated products such as the spot XRP ETFs.

Unlike futures-based ETFs, spot ETFs require active SEC approval before trading can begin. Terrett addressed misconceptions circulating online after a post by analyst Chad Steingraber, who suggested that a lack of SEC response could imply approval. She emphasized that spot crypto ETFs are registered under the Securities Act of 1933 as commodity trusts, which mandates explicit SEC approval. In contrast, the Teucrium 2x Long Daily XRP ETF operates under the Investment Company Act of 1940 and holds assets such as Treasuries and swap receivables, allowing it to bypass the more rigorous approval process.

Impact of Government Shutdown on ETF Reviews

The ongoing U.S. government shutdown has forced the SEC to operate with a reduced workforce, limiting its ability to review new financial products. Consequently, the final review process for spot crypto ETFs remains stalled. Legal analyst Bill Morgan noted that while late October approvals are still possible, any decision depends heavily on when the SEC resumes normal operations. The missed final deadline for the Canary Litecoin ETF highlights the growing backlog of pending reviews.

Several spot XRP ETF applications are approaching final deadlines later this month. The SEC is expected to address proposals from major asset managers, including Grayscale on October 18, 21Shares on October 19, Bitwise on October 20, Canary Capital on October 23, WisdomTree on October 24, and CoinShares on October 25. The agency’s next steps will depend on its operational capacity once the government resumes full activity.

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