The U.S. Securities and Alternate Fee seemingly 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 approved GDLC to uplist as an exchange-traded fund (ETF) on Tuesday via staffers’ delegated authority, that means the regulator’s commissioners didn’t should vote on the applying. However, the regulator knowledgeable Grayscale and the New York Inventory Alternate — GDLC’s itemizing companion — on Wednesday that the SEC’s commissioners will review the approval, pausing GDLC’s go-live date within the meantime.
GDLC relies on CoinDesk Indices’ CoinDesk 5 Index.
Halting the launch provides the SEC time to develop itemizing requirements for different ETFs that might launch underneath the identical mechanism, the people stated.
There’s additionally the truth that GDLC incorporates two digital property — XRP
and Cardano — that do not at present have their very own particular person ETFs. Two of the opposite property 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 property. Solana additionally saw its first ETF launch earlier this week, although functions for different ETFs tied to the asset stay underneath SEC overview.
The SEC faces deadlines later this 12 months for the XRP, ADA and SOL functions.
James Seyffart, Bloomberg Intelligence ETF analyst, informed CoinDesk that the SEC’s pause was “not regular.” In a post on X, he wrote that there are two potential causes behind the transfer.
“The SEC does not need to let something to launch underneath the 19b-4 course of till they formally approve or provide you with some framework for digital property within the ETF wrapper.” The opposite possibility, he wrote, is that the SEC desires to work on one thing in relation to a particular facet of the fund itself, for instance the construction.
In a press release, a Grayscale spokesperson stated the SEC’s pause “was sudden” 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 essential necessities. We’ll present additional updates as extra info turns into out there,” the spokesperson stated.
An 8-K filing 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 applying.”