Grayscale Cardano Trust ETF Proposal Acknowledged by SEC, Clock Starts Ticking for Approval

The US Securities and Exchange Commission has acknowledged NYSE Arca's proposal on behalf of crypto asset manager Grayscale to list and trade a spot Cardano exchange-traded fund (ETF).

NYSE Arca’s proposal on behalf of crypto asset manager Grayscale to list and trade a spot Cardano exchange-traded fund (ETF) has been acknowledged by the US Securities and Exchange Commission.

The SEC's Feb. 24 acknowledgment of the Grayscale Cardano Trust is the first step toward approval, kicking off the agency's timeline to approve or reject the proposed ETF.

The SEC has received a slew of crypto ETF acknowledgments under the new leadership, including Cboe's XRP ETF, Grayscale's spot XRP and Dogecoin ETF, and Nasdaq's filing to set and exercise limits on options tied to BlackRock's iShares Bitcoin Trust (IBIT).

NYSE Arca, a subsidiary of the NYSE Group, first filed a proposal with the SEC to list and trade shares of the Grayscale Cardano Trust on the stock exchange on Feb. 10.

The proposed ETF will follow Cardano's price through an index that tracks its daily price on crypto exchanges Coinbase, Crypto.com, Bitfinex and Kraken.

The exchanges were selected for the index based on being “in material compliance with applicable US federal and state licensing requirements.”

Investors in the ETF will not hold Cardano (ADA) directly but will have shares in the trust.

“An investment in the Shares is not a direct investment in ADA; the Shares are designed to provide investors with a cost-effective and convenient way to gain investment exposure to ADA,” the filing states.

Coinbase Custody Trust Company is set to be the custodian for the exchange-traded fund, while BNY Mellon Asset Servicing will be the transfer agent and administrator.

notably, Bitfinex does not hold any licenses or registrations in the US but was included because it met the “minimum liquidity requirement.”

A wave of ETF applications filed

Crypto-themed ETF applications have hit the scene following the inauguration of crypto-friendly US President Donald Trump,

On Feb. 24, United States securities exchange Nasdaq filed to list an ETF that will hold the Hedera Network’s native token, HBAR.

Meanwhile, the SEC acknowledged half a dozen exchange filings related to cryptocurrency ETFs in two days on Feb. 19 and 20, covering staking, options, in-kind redemptions and new types of altcoin funds.