-
The U.S. Securities and Exchange Commission (SEC) has once again delayed decisions on Polkadot and Hedera ETFs, signaling ongoing regulatory caution in the crypto investment space.
-
Market analysts project that approvals for these crypto ETFs may not materialize until late 2025, extending investor uncertainty.
-
According to COINOTAG sources, industry leaders like Canary Capital advocate for reinstating the ‘first-to-file’ approval system to foster fairness and competition.
SEC delays Polkadot and Hedera ETF approvals, with analysts forecasting potential green lights only by Q4 2025 amid calls for regulatory reform.
SEC’s Continued Postponement of Polkadot and Hedera ETF Decisions Reflects Regulatory Prudence
The U.S. Securities and Exchange Commission (SEC) has extended its review period for the proposed Polkadot (DOT) and Hedera (HBAR) ETFs by requesting additional public commentary. This move delays the decision beyond the second statutory deadline, pushing the final ruling to November 8, 2024. The SEC’s cautious stance underscores its ongoing scrutiny of crypto-linked investment products, emphasizing the need for comprehensive market safeguards before granting approval.
Implications of the SEC’s Delay on Market Dynamics and Investor Sentiment
By postponing decisions on Canary Capital’s Hedera ETF and Grayscale’s Polkadot ETF, the SEC has introduced further uncertainty into the crypto ETF landscape. Analysts like Bloomberg’s James Seyffart anticipate that approvals may not come until the fourth quarter of 2025, aligning with the final regulatory deadlines. This delay affects market participants’ strategic planning and may temper short-term enthusiasm for these digital asset funds. Despite this, price movements for DOT and HBAR remain relatively stable, indicating measured investor confidence amid regulatory ambiguity.
Analyst Perspectives: Timeline and Outlook for Crypto ETF Approvals
Industry experts maintain a cautious outlook regarding the timeline for crypto ETF approvals. Eric Balchunas, a prominent ETF analyst, suggests that while active crypto ETFs could emerge by winter 2025, more niche products like memecoin-focused ETFs may take until 2026 to gain regulatory acceptance. This phased approach reflects the SEC’s methodical evaluation process, balancing innovation with investor protection. Grayscale currently leads the Polkadot ETF application, while Hedera ETF filings are contested between Grayscale and Canary Capital, with the latter advocating for expedited consideration based on filing precedence.
Calls for Regulatory Reform: The ‘First-to-File’ Approval Model
In response to ongoing delays, Canary Capital, VanEck, and 21Shares have publicly urged the SEC to reinstate the ‘first-to-file’ approval framework. This model prioritizes the earliest applicant, potentially streamlining approvals and fostering a more competitive ETF market. Advocates argue that such a system would reduce procedural bottlenecks and incentivize innovation. While the SEC has not yet responded to this appeal, industry stakeholders view it as a critical step toward enhancing regulatory clarity and fairness in crypto ETF approvals.
Market Reaction: Stability Amid Regulatory Uncertainty
Despite the postponements, the market response to the SEC’s actions has been muted. Polkadot (DOT) experienced a 4.52% gain, trading at approximately $4.30, while Hedera (HBAR) increased modestly by 1.65% to $1.798. This resilience suggests that investors maintain a cautiously optimistic outlook on these assets, recognizing their long-term potential despite short-term regulatory hurdles. The steady price action also reflects broader market dynamics where fundamental adoption trends and network developments continue to influence valuation independently of ETF approval timelines.
Conclusion
The SEC’s decision to delay rulings on Polkadot and Hedera ETFs highlights the regulatory complexities surrounding crypto investment products. While this cautious approach may prolong uncertainty, it also ensures thorough market evaluation and investor protection. Analysts predict that meaningful approvals are unlikely before late 2025, with industry calls for reinstating the ‘first-to-file’ rule signaling a push for greater procedural efficiency. Investors should monitor regulatory developments closely while considering the stable market performance of DOT and HBAR as indicators of sustained confidence in these digital assets.
