Bloomberg Analysts Expect a Wave of Crypto ETFs in 2025

Highlights:

• Multiple crypto ETFs are expected to launch next year with leadership changes at the SEC.
• Bitcoin-Ethereum combination products will likely lead the way, followed by Litecoin and HBAR.
• Solana and XRP ETFs face uncertainty due to regulatory challenges and upcoming leadership changes.

Bloomberg analysts Eric Balchunas and James Seyffart expect multiple new crypto exchange-traded funds (ETFs) to launch the next year, following anticipated changes in US Securities and Exchange Commission (SEC) leadership under President-elect Donald Trump’s administration. The duo anticipates Bitcoin-Ethereum (ETH) combination products will be the first to launch. Litecoin (LTC) and Hedera Hashgraph (HBAR) may follow closely. They said that regulatory challenges could delay ETFs linked to Solana (SOL) and XRP, creating uncertainty. 

“Dual bitcoin and ethereum ETFs from Hashdex, Franklin [Templeton] and Bitwise will likely be the next spot crypto ETFs approved,” Seyffart wrote. 

Litecoin and HBAR ETFs Have Higher Approval Odds

Balchunas highlighted Litecoin’s strong position. He cited research from Seyffart, pointing to Litecoin’s close ties to Bitcoin. Litecoin, being a fork of Bitcoin, may benefit from its commodity classification. This aligns with how the SEC currently treats Bitcoin. Meanwhile, HBAR has not been labeled a security so far. This places it ahead of tokens that are facing continuous 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.”

Proposals for Solana and XRP ETFs have been filed. There is little chance of their approval before Trump takes office. Canary Capital is the only issuer currently filing for Litecoin and HBAR ETFs.

We expect a wave of cryptocurrency ETFs next year, albeit not all at once. First out is likely the btc + eth combo ETFs, then prob Litecoin (bc its fork of btc = commodity), then HBAR (bc not labeled security) and then XRP/Solana (which have been labeled securities in pending… pic.twitter.com/29vMdciZxE

— Eric Balchunas (@EricBalchunas) December 17, 2024

FOX Business journalist Eleanor Terrett reported that the current SEC leadership rejected two of the five applications for Solana ETFs this month. However, the SEC has not yet issued a decision regarding the multiple filings for XRP ETFs. Despite this, analysts Balchunas and Seyffart believe a new SEC administration will approve a joint XRP and Solana ETF.

Crypto ETF Outlook Brightens Following Trump’s Victory and Gensler’s Departure

The outlook for new crypto ETFs improved after Donald Trump’s election victory. Gary Gensler’s departure as SEC chair also played a role in this shift. Gensler opposed digital assets and crypto-related investment products throughout his time in office. Despite his stance, spot Bitcoin ETFs attracted billions in investments. With Gensler gone, regulators are likely to shift their tone.

Trump nominated Paul Atkins, a pro-crypto former SEC commissioner, to replace Gensler. Atkins plans to implement a lighter regulatory approach, which could ease the path for crypto ETFs. He appointed David Sacks as the new Crypto Czar. It’s unclear if these pro-crypto advocates will support the industry and help approve crypto ETFs.

BREAKING 🔥 🔥

🇺🇸Trump officially selected pro-crypto Paul Atkins to replace Gary Gensler as SEC Chair.#BTC #Crypto 🚀🚀 pic.twitter.com/qjjGDHWAik

— Wise Advice (@wiseadvicesumit) December 4, 2024

In a tweet last month, the analyst revealed key details. He stated that 14 altcoin-related ETFs are awaiting SEC approval. These approvals are expected to happen within the next 12 months. According to him, the number of applications could triple in two months.