Grayscale’s conversion of its Digital Large Cap Fund (GDLC) into an exchange-traded fund (ETF) has been frozen by a stay order, despite receiving approval from the Securities and Exchange Commission (SEC) on July 1.

Bloomberg ETF analyst James Seyffart said in a social media post on July 2 that the stay blocks the conversion “for now” and that the SEC gave no timeline for removal.

Two theories

Seyffart shared two working theories for the temporary block that came with the approval. The first is that staff in another division may still vet GDLC’s structure, or the SEC may prefer to keep every crypto listing on hold until it finishes a broader rule set for token-based ETFs.

Meanwhile, Bloomberg senior ETF analyst Eric Balchunas assessed that the SEC could be waiting for the first spot ETFs tracking Solana, Cardano, and XRP to hit the market before allowing Grayscale to trade its multi-asset fund.

The approval amended NYSE Arca Rule 8.500-E, allowing the trust’s units to trade on the exchange once the operational details are cleared. 

GDLC holds Bitcoin, Ethereum, Solana, XRP, and Cardano. Grayscale reports roughly $775 million in assets under management for the product. 

When the stay is lifted, the fund will transition to an in-kind creation and redemption format, replacing the current closed-end structure.

Standardized framework

Recent reports suggested that the  SEC and US exchanges are working on drafting a generic listing standard for token ETFs. 

Under the proposal, an issuer would file only a Form S-1, wait the customary 75 days, and launch if the registration becomes effective. The framework would allow issuers to sidestep the current Rule 19b-4 change each product now needs. 

Seyffart called the prospect “very good news” because a single standard would shorten timelines and supply clear thresholds for market capitalization, trading volume, and liquidity.

Other crypto basket funds, including filings submitted by Bitwise, Hashdex, and Franklin Templeton, are awaiting SEC approval.

Based on one of Seyffart’s theories, the regulator might be waiting to give GDLC full clearance so it can approve the other ETFs under the same standards.

Notably, the deadline for a decision on Bitwise’s filing expires on July 31, which could be a key date to watch and expect for the rumored framework.

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A major breakthrough has just arrived for Bitcoin and the crypto industry from one of the most influential financial regulatory bodies in the United States. The Federal Housing Finance Agency (FHFA), which oversees the country’s largest mortgage liquidity providers, has issued a directive that could change how digital assets are viewed. 

Under this directive, mortgage liquidity providers have been officially ordered to begin preparations for considering cryptocurrencies as part of a borrower’s asset portfolio during mortgage evaluations.

Crypto As Mortgage-Eligible Asset

In a recent post on the social media platform X, FHFA Director Bill Pulte issued a directive instructing Fannie Mae and Freddie Mac to prepare proposals that allow homebuyers to count cryptocurrency holdings held on US-regulated exchanges as part of their asset reserves for mortgage applications without converting them into dollars.

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Crypto assets have always been excluded from mortgage risk assessments unless converted to U.S. dollars before closing. However, this recent move breaks that barrier. This policy shift aligns with former President Donald Trump’s campaigns to establish the United States as the crypto capital of the world. Pulte, who was recently sworn in as the 5th Director of U.S. Federal Housing FHFA in March 2025, is now part of those taking steps to make this vision a reality. 

According to the order, both Fannie Mae and Freddie Mac must also factor in market volatility and enforce strong risk-based adjustments before implementing the new assessment method. Fannie and Freddie are government-sponsored enterprises that do not issue mortgages themselves but play an important role in the housing market by purchasing home loans on the secondary market and setting the criteria for the loans they are willing to acquire.

Bitcoin To Benefit The Most, But Where Does XRP Stand?

Bitcoin is going to benefit the most from this policy update. Being the largest and most widely held cryptocurrency, Bitcoin has long been considered the digital gold standard, which makes it a natural candidate for institutional recognition. 

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Its established presence on U.S.-regulated exchanges and deep liquidity profile through Spot Bitcoin ETFs tick nearly every box laid out in the FHFA’s directive.

However, the decision raises an important question for XRP holders as to whether the same regulation will be extended to XRP. Unlike Bitcoin, XRP has had a complicated history with regulatory agencies in the US, most notably the SEC. Although recent legal clarity around XRP has allowed the crypto to resume trading on major US-based exchanges, it isn’t really certain whether Fannie Mae and Freddie Mac will be quick to include it under this new directive.

Nonetheless, the FHFA’s directive doesn’t specify eligible tokens. It simply refers to cryptocurrencies held on US-regulated exchanges. As such, the directive could be quick to include US-based cryptocurrencies like XRP and Ethereum alongside Bitcoin. Other countries are already far ahead with XRP in real estate. In Japan, for instance, Open House Group allows XRP payments for property purchases in cities such as Tokyo and Osaka. Dubai is also using the XRP Ledger to tokenize real estate.

Featured image from Pixabay, chart from Tradingview.com

In a bipartisan effort, Representatives Mike Flood and Wiley Nickel are urging the U.S. Securities and Exchange Commission (SEC) to greenlight options trading on Spot Bitcoin ETFs. These lawmakers have written a letter addressed to SEC chair Gary Gensler, pushing him to consider their request.

SEC Chair Gary Gensler Under Pressure To Approve Bitcoin ETF Options

The significance of this push lies in the delay issuers have faced in launching options following the historic approval of Spot Bitcoin ETFs in January. The ETFs secured the SEC approval following a long delay that too after a court ruling. Now, Flood and Nickel are adamant that the SEC doesn’t perpetuate discrimination against these newly established funds.

Expressing the critical nature of approving options trading on Bitcoin ETFs, the letter emphasizes its importance to the investors whom the SEC aims to safeguard. Flood and Nickel, representing both Republican and Democrat perspectives, underscore the need for prompt action. Moreover, they also encourage a transparent explanation for treating options for Bitcoin futures ETFs differently from Spot Bitcoin ETFs.

According to a report by Axios, the letter sent to Gensler read, “We urge you, without delay, to approve options on spot Bitcoin ETPs or to provide an explanation for the Commission’s difference in treatment between options for Bitcoin futures ETFs—which are currently trading—and options for the spot Bitcoin ETPs.”

Also Read: U.S. Bitcoin ETF Outflows Jump Past $560 Million, More Pain Ahead?

Will CFTC Be Involved?

The broader context reveals a disparity in the approval process between market stock ETFs. The stock ETFs typically see options trading approval shortly after launch while commodity trust-based fund face a more intricate and prolonged process. This complexity arises from the necessity of obtaining approval from multiple government agencies, including the Commodity Futures Trading Commission (CFTC).

Moreover, insiders close to the matter anticipate the CFTC to pose the primary obstacle rather than the SEC. The CFTC’s involvement in approving such products also stems from the recent contradiction from the SEC over the Ethereum (ETH) controversy. Hence, it remains to be seen if the CFTC and the SEC would collaborate on deciding whether the Bitcoin ETF options should be approved or not.

Also Read: European Bank With $600B AUM Invests In BlackRock Bitcoin ETF

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