A “new wave” of crypto exchange-traded funds (ETFs) is expected in 2025 as the regulatory landscape improves under the incoming Trump administration, according to Bloomberg Intelligence analysts.
Bitcoin-Ethereum (ETH) combination products will likely lead the charge, followed by Litecoin (LTC) and Hedera Hashgraph (HBAR). However, legal and regulatory hurdles are expected to delay ETFs tied to Solana (SOL) and XRP, leaving their future uncertain.
Bloomberg ETF analyst Eric Balchunas, citing research from colleague James Seyffart, emphasized Litecoin’s favorable position due to its close ties to Bitcoin (BTC).
As a fork of Bitcoin, Litecoin could benefit from its commodity classification, which aligns with how the US Securities and Exchange Commission (SEC) treats Bitcoin. Meanwhile, HBAR has avoided being labeled a security so far, positioning it ahead of tokens facing ongoing regulatory scrutiny.
Seyffart wrote:
“Litecoin and HBAR both have higher odds of approval compared to Solana and XRP. However, it’s unclear whether there’s investor demand.”
Canary Capital, a new issuer, is currently the only filer for ETFs tied to Litecoin and HBAR, raising questions about the level of market interest in these products.
Potential delays
The analysts also highlighted that Solana and XRP ETFs could potentially face more significant delays.
The SEC’s rejection of recent Solana filings and the legal ambiguity surrounding both tokens have complicated their approval prospects. Additionally, ongoing lawsuits focused on their classification as securities remain a key hurdle, and analysts suggest these issues will need to be resolved before ETF applications gain any traction.
The broader outlook for crypto ETFs hinges on the direction of regulatory leadership under the next US administration. Greater clarity around token classifications could reshape the ETF landscape and allow altcoins like Solana and XRP to join Bitcoin and Ethereum products.
While 2025 could mark a turning point for crypto ETFs beyond Bitcoin and Ethereum, the analysts cautioned that legal uncertainty and tepid investor demand for alternative crypto products may continue to limit momentum in the near term.
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2024-12-17 20:00:37
