A Paradigm Shift in Crypto Regulation: Bloomberg Analysts Boost Altcoin ETF Approval Odds to 90%
In what could represent a watershed moment for the digital asset industry, leading analysts from Bloomberg have sharply increased the probability of U.S. regulators approving a new wave of exchange-traded funds (ETFs) for a variety of cryptocurrencies. This renewed optimism stems from a notable shift in the stance of the Securities and Exchange Commission (SEC), suggesting a new, more constructive era of crypto regulation may be dawning.
On June 20, 2025, senior Bloomberg ETF analysts Eric Balchunas and James Seyffart—two of the most respected voices on financial product regulation—announced they now see a “90% or higher” chance that a broad range of crypto ETFs beyond Bitcoin and Ethereum will win regulatory approval. This forecast signals a potential opening of the floodgates for mainstream investment into a new class of digital assets.
The Thawing of a Regulatory Winter
This significantly revised forecast is rooted in what the analysts describe as highly «constructive discussions» between the SEC and asset managers. The dialogue marks a considerable departure from the previously adversarial relationship between the regulator and the crypto industry, pointing towards a more collaborative and predictable path forward.
The most tangible evidence of this «regulatory thaw» came when the SEC recently requested that several asset managers pursuing spot Solana ETFs amend their applications. The regulator specifically asked for clearer details on two critical operational mechanics:
- In-Kind Redemptions: This model allows the fund to process inflows and outflows using the underlying asset (in this case, SOL tokens) rather than cash, which is generally more efficient and tax-friendly.
- Staking Provisions: The SEC is engaging on the complex issue of whether the ETF would be permitted to stake the SOL held in the fund to earn yield for investors.
That the SEC is engaging on these granular, technical details for an altcoin ETF is a profoundly bullish signal. It indicates the commission has moved past the initial question of if such a product should exist and is now focused on how it will function. This development promptly spurred other firms that had not yet filed for Solana ETFs to fast-track their submissions last week. With updated filings submitted in mid-June and a 30-day response window for the regulator, expectations are mounting for potential approvals within the next four to five weeks.
The Tectonic Shift: Altcoins as Commodities
Perhaps the most significant implication from these developments is the SEC’s apparent classification of several major cryptocurrencies. Balchunas and Seyffart indicated that the regulator likely views assets such as Litecoin (LTC), Solana (SOL), XRP, Dogecoin (DOGE), and Cardano (ADA) as commodities.
This classification is a game-changer. By not designating them as securities, the SEC effectively places them outside its most stringent oversight, aligning them more closely with assets like gold, oil, or wheat, which are primarily regulated by the Commodity Futures Trading Commission (CFTC). This removes a massive legal and regulatory overhang that has for years prevented the creation of mainstream investment products for these assets in the United States.
Market Context: A Tale of Two ETFs and the Coming Wave
The enormous anticipation for altcoin ETFs is built on the foundation of the unprecedented success of the spot Bitcoin ETFs launched earlier this year. These products shattered records for capital inflows, proving the existence of massive, untapped institutional and retail demand for a regulated, accessible way to invest in crypto. BlackRock’s iShares Bitcoin Trust (IBIT), for instance, surpassed $70 billion in assets under management earlier this month, making it one of the fastest-growing ETFs in history.
However, the path is not always linear. Similar products tracking Ethereum, which launched in July 2024, have faced a notably slower uptake. Blockchain analytics indicate that many early investors in these Ether ETFs remain at a loss compared to their entry price, highlighting that regulatory approval alone does not guarantee immediate performance.
Despite this, the momentum is undeniable. Major fund issuers, including Franklin Templeton, have already filed formal proposals for ETFs tied to assets like XRP and Solana. These applications are now open for public feedback as the SEC weighs its next moves, setting the stage for a new race to capture the next wave of investor interest.
While the odds of approval have dramatically increased, Balchunas and Seyffart cautioned that the final green lights and market debuts for these funds could still be several months away, pending the finalization of all regulatory filings and operational preparations.
Frequently Asked Questions (FAQs)
1. What is a spot crypto ETF and why is it significant? A spot crypto ETF (Exchange-Traded Fund) is an investment fund that holds a cryptocurrency, like Solana, as its underlying asset. It trades on a traditional stock exchange (like the NYSE or Nasdaq), allowing investors to gain exposure to the crypto’s price movements through a standard brokerage account, without needing to open a separate crypto wallet or account. Its significance lies in its ability to provide easy, regulated, and secure access for a broad range of investors, from individuals to large institutions.
2. What is the practical difference between a crypto being a «commodity» versus a «security»? The distinction is critical for regulation in the U.S.
- Security: If an asset is deemed a security, it falls under the strict jurisdiction of the SEC. Issuers face rigorous disclosure and registration requirements, similar to stocks and bonds.
- Commodity: If it’s a commodity, it is primarily overseen by the CFTC. This regulatory framework is generally less restrictive for the underlying asset itself, making it much easier to create derivative products and ETFs, as has been the case with gold and oil.
3. If these new ETFs are approved in the next few weeks, can I buy them immediately? Not necessarily. There is a two-step approval process. First, the exchanges’ rule change filings (19b-4s) must be approved. Then, the individual fund issuers’ registration statements (S-1s) must become effective. Even after both approvals, it can take days, weeks, or even months for the funds to complete their final preparations and begin trading on the exchanges.
4. Why did Bitcoin ETFs succeed so massively while Ethereum ETFs had a slower start? Several factors may contribute to this. Bitcoin has a simpler and more powerful narrative as «digital gold,» which resonates strongly with traditional investors looking for an inflation hedge. The launch of the Bitcoin ETFs was a landmark event that unleashed years of pent-up demand. Ethereum’s value proposition is more complex, involving smart contracts, staking, and the «world computer» concept, which may be less immediately graspable for new investors. Market timing and broader economic conditions at the time of each launch also play a significant role.
5. Who are Eric Balchunas and James Seyffart, and why are their opinions respected? Eric Balchunas and James Seyffart are senior ETF analysts for Bloomberg Intelligence, a leading financial data and media company. They are widely regarded as two of the foremost experts on the exchange-traded fund industry. Their analyses are closely followed by financial professionals because they are based on deep research, industry contacts, and a thorough understanding of the regulatory process at the SEC. Their track record on predicting the approval of the spot Bitcoin ETFs has given their forecasts significant weight and credibility.
