The U.S. Securities and Exchange Commission (SEC) has unexpectedly halted the approval process of Grayscale’s Digital Large Cap (GDLC) cryptocurrency exchange-traded fund (ETF). The decision to elevate the ETF’s approval to a commissioner review from a staff-level approval, granted on July 1, 2025, indefinitely delays the fund’s execution, bringing uncertainty to the planned listing of a financial product that includes five major cryptocurrencies: Bitcoin (BTC), Ethereum (ETH), Solana (SOL), Ripple (XRP), and Cardano (ADA). Though this pause was unexpected, Grayscale’s commitment to the ETF remains steadfast.
What Prompted the SEC’s Recent Decision?
Initially approved by mid-level staff, the SEC now seeks an open vote from all five commissioners. This shift aims to ensure that decisions on cryptocurrency-based securities reside within the highest levels of the SEC’s hierarchy. The move also responds to the contentious nature of delegation decisions, which can slow progress pending the establishment of permanent guidelines.
Bloomberg’s James Seyffart expresses caution, suggesting that launching multi-asset ETFs might be premature in the absence of independent approvals for XRP and ADA-based ETFs. He notes that the fund could eventually see a listing if the Commission finds no inherent structural concerns, although the timeline remains uncertain.
How Could This Affect the Crypto Sector?
While the delay dampens hopes for multi-asset cryptocurrency ETFs, it may lead to clearer regulations. The inclusion of more disputed assets alongside mainstays like Bitcoin and Ethereum underlines the SEC’s comprehensive risk evaluation approach. Experts anticipate the unveiling of new listing criteria soon.
Grayscale remains proactive, revising their documentation and maintaining dialogue with stakeholders. According to Bloomberg’s Eric Balchunas, despite the delay, GDLC is likely to reappear on the SEC’s agenda following guideline releases.
The SEC’s decision underscores several key points for stakeholders:
- The necessity for centralized decision-making within the SEC may prolong approval processes.
- Grayscale’s strategic planning and consultation work indicate long-term commitment to its initiatives.
- An elevated focus on risk assessment may lead to enhanced guidelines for multi-asset ETFs.
Ultimately, this development serves as a crucial juncture in the evolving landscape of cryptocurrency regulation. As the SEC contemplates its decision on the GDLC fund, market participants eagerly await greater clarity and insight into the sector’s future regulations.
