Originally published on: November 04, 2024
With the United States presidential election just around the corner on Nov. 5, the future of several cryptocurrency exchange-traded funds (ETFs) hangs in the balance, awaiting regulatory approval.
Back in 2024, asset managers were quick to submit regulatory filings for ETFs holding alternative coins like Solana, XRP, and Litecoin, among others. There are also plans for crypto index ETFs that aim to hold diverse token baskets.
According to Eric Balchunas, an ETF analyst at Bloomberg Intelligence, these filings are essentially “call options on a Trump victory” in the upcoming election.
Interestingly, three out of four crypto owners have expressed that a candidate’s crypto policy will influence their voting decisions, showing just how important the industry has become in the political landscape.
The race pits Republican nominee Donald Trump, who has championed making America the “crypto capital of the world,” against Democrat Kamala Harris, who has been relatively quiet on the industry front.
Under the current administration, led by President Joe Biden and Vice President Harris, the US Securities and Exchange Commission (SEC) has taken a strict regulatory stance on crypto, resulting in numerous actions against industry companies.
If Trump secures a victory in the election, we can expect some significant moves in the crypto ETF space. Asset managers VanEck and 21Shares have already filed for SOL ETFs with the SEC, with Canary Capital following suit.
While Bitcoin and Ether remain dominant in terms of market capitalization, the approval of an ETH ETF may not necessarily pave the way for other types of crypto ETFs, according to industry experts.
The SEC’s classification of SOL as a security has not deterred plans for a SOL ETF listing, with firms like VanEck continuing to advocate for its classification as a commodity.
In recent months, filings for XRP and spot Litecoin ETFs have also emerged, indicating a growing interest in expanding the crypto ETF market.
NYSE Arca has even sought SEC approval to list shares of the Grayscale Digital Large Cap Fund, which includes a diverse portfolio of cryptocurrencies like BTC, ETH, SOL, XRP, and Avalanche.
As election day draws near, the fate of these crypto ETFs remains uncertain, with the regulatory landscape likely to shift depending on the outcome. Stay tuned for updates on how the US presidential election could impact the future of the crypto industry.
