XRP and SOL ETFs Face Regulatory Hurdles, Approval Possible by 2025: Bloomberg

Bloomberg’s James Seyffart has shared insights on the challenges facing XRP and SOL ETFs, predicting potential approval by 2025.

Bloomberg analyst James Seyffart has provided updates on the challenges faced by XRP and SOL ETFs, anticipating potential approval by 2025.

As per Seyffart, the present regulatory landscape for cryptocurrency ETFs remains uncertain due to prior decisions by the SEC.

The approval of Bitcoin and Ethereum ETFs was largely attributed to their connection to the CME regulated futures markets. However, many altcoins, including SOL and XRP, do not have regulated futures markets, which may complicate the ETF approval process.

“Without a regulated market of significant size, the SEC has historically denied altcoin ETF applications,” explained Seyffart. He noted that the SEC's leadership could change these rules in 2025, but the approval timeline is still up in the air.

Despite the filings, Seyffart highlighted that the current regulations do not permit XRP ETFs. Several concerns must be addressed before these products can proceed, including market manipulation, custody, and regulatory issues.

Highlighting the recent XRP ETF filings, such as WisdomTree's “WisdomTree XRP Fund,” positive developments are emerging for alternative cryptocurrency exchange-traded funds (ETFs). The company is expected to file the official S-1 registration with the US SEC shortly after registering this fund in Delaware.

According to Bloomberg analyst James Seyffart, future exchange-traded funds may include staking for altcoins like Ethereum — and possibly others such as SOL and XRP. However, he noted that staking is not currently permitted within ETF structures.

“If a more crypto-friendly US SEC administration takes charge, we may see staking allowed in 2025,” he added, suggesting that legalizing staking could drive demand for such products.

There are two main ways for exchange-traded funds (ETFs) to be filed, according to Bloomberg analyst James Seyffart: One is the 19b-4 rule filing with the SEC's Division of Trading Markets, which initiates a formal review phase with due dates, and the other is the S-1 prospectus, which does not have due dates.

The majority of altcoin ETFs have not yet completed the 19b-4 process, he noted, unlike Bitcoin and Ethereum. This indicates that the regulatory clock is not yet ticking on their approval.

“Even if altcoin ETF filings begin the 19b-4 process today, decisions could take until late 2025,” said Seyffart, highlighting the potential time frame for approvals.

The analyst also touched on the potential impact of upcoming SEC leadership changes. While the extent of the changes is unknown, a new US SEC chair with a pro-crypto administration would fast-track the approval process.

James Seyffart, an analyst at Bloomberg, has also commented on the possibility of multi-asset index ETFs, such as those that invest in Bitcoin, Ethereum, and other cryptocurrencies like SOL and XRP. Products that have applied to become exchange-traded funds (ETFs) may face fewer regulatory hurdles; for instance, Bitwise's Crypto 10 Index and Grayscale's GDLC have a high exposure to Bitcoin and Ethereum.

He explained how these smaller cryptocurrency holdings’ adherence to existing rules will likely determine whether the SEC approves these products for sale.

On the approval of cryptocurrency ETFs, Seyffart remains optimistic but not entirely sure, as the incoming SEC administration will have the final say.

According to him, decisions on XRP, SOL, LTC, and HBAR ETFs might be made as early as 2025, but the frequency of these occurrences will depend on leadership changes and broader regulatory shifts.