Grayscale, 21Shares, and a16z are among firms asking the SEC to overhaul its exchange-traded product review process, including confidential draft filings and tighter response timelines.
The submissions, posted to the SEC public comment docket under rule S7-2026-24, come as the regulator weighs changes to how it handles novel crypto ETF applications. The review was prompted by a surge in filings for products tracking ether, solana, XRP, and various index baskets. The SEC had asked whether artificial intelligence is contributing to a wave of largely identical applications submitted in rapid succession. Several sponsors have submitted filings that differ only in fee structures and ticker symbols, raising questions about whether the current system encourages genuine innovation or just filing races.
Grayscale said an optional confidential process would reduce the incentive for competing sponsors to copy public registrations. It also wants SEC staff to commit to responding within 45 days of a filing. 21Shares made a parallel request, pointing to how quickly rivals can duplicate public filings once they hit the docket.
A16z took a different angle, arguing that electronic submissions, templated disclosures, and repeated questions across products all justify a shorter review. The venture firm was careful to add that a faster process should not mean lighter scrutiny. Markets move faster than the existing review timeline, a16z said, and the gap between filing and approval increasingly creates risk for sponsors and investors alike.
Not everyone wants speed. Jane Street warned that pressure to launch quickly can produce rushed registrations and leave less time for sponsor feedback on fund structure and liquidity. The market maker proposed requiring ETFs to launch with at least two authorized participants to ensure stable creation and redemption flows. Fewer authorized participants can create thin liquidity that hurts retail investors, Jane Street said.
Charles Schwab opposed making filings fully confidential. If the SEC holds confidential discussions with a sponsor, Schwab said, the filing should become public at least 75 days before the fund goes effective. The firm argued that market participants need time to evaluate products before they begin trading, and that secrecy could advantage well-connected sponsors over smaller ones.
Staking Tokens and Exchange Timelines
Several firms used the review to push beyond filing mechanics. Multicoin Capital wants qualifying staking receipt tokens allowed in spot crypto ETPs, potentially making up substantially all of a fund digital asset holdings. Staking receipt tokens represent crypto assets that have been staked on proof-of-stake networks to earn rewards. Allowing them in ETPs would let fund managers capture staking yield for shareholders, something the SEC has so far blocked in spot products.
Jito Labs, the Jito Foundation, and the Solana Policy Institute joined Multicoin in asking the SEC to establish clear rules for staking receipt tokens in spot products. The joint submission focused specifically on Solana-based staking, arguing that the network 6 percent annual yield makes staking receipts a material component of any Solana ETP. Without access to staking, a Solana ETP would underperform the underlying asset by roughly 6 percentage points per year, the group argued.
From the exchange side, NYSE asked for more predictable timelines when novel products reach exchanges. It said SEC staff can currently ask an exchange to delay a listing while an issue is considered without giving it a firm deadline, even when another exchange may be able to proceed. NYSE wants a rule that prevents one exchange delay from holding up listings across all venues.
A Broader Debate Over Speed vs. Scrutiny
The comments reveal a divide between crypto-native firms and traditional financial institutions. Grayscale, 21Shares, and a16z all emphasized the need for faster processing, framing the current timeline as a competitive disadvantage relative to jurisdictions like the EU and Hong Kong, where crypto ETP frameworks have been in place for years. Jane Street and Schwab, by contrast, stressed the importance of thorough review and market infrastructure readiness.
The SEC opened this review in July, asking for public input on whether its treatment of novel exchange-traded products should change. The agency noted that the number of crypto-related ETF filings had increased sharply, and that many were substantially similar in structure. The AI question was one of several specific topics the SEC raised.
Comments on the SEC request were due August 31, though the regulator has continued to post submissions dated after the deadline. The SEC has not set a timeline for any further action on the rulemaking.
What This Means for the ETF Pipeline
The filing flurry reflects how crowded the crypto ETF market has become. Since the SEC approved spot bitcoin ETFs in January 2024, dozens of sponsors have submitted applications for products tracking ether, solana, XRP, and various index baskets. The result is a backlog that the current review process was not designed to handle. Some sponsors have waited more than a year for a decision on products that differ little from already-approved funds.
The comments also highlight a tension at the heart of crypto ETF regulation. Firms that want faster reviews argue the market has matured enough to justify streamlined processes. Firms that want more scrutiny worry that speed will come at the cost of investor protection. The staking question adds another layer, pitting yield-seeking fund managers against a regulator still cautious about the risks of staked assets in regulated wrappers.
Whether the SEC moves on confidentiality, timelines, staking eligibility, or all three will shape the next wave of crypto ETF launches. The comment period is closed, but the submissions keep arriving. For now, the pipeline remains clogged.
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