Grayscale Investments Seeks SEC Final Approval for Hybrid Crypto ETF
Date: 2025-07-14 Author: Oliver Abernathy Categories: BUSINESS
Grayscale Investments has sent a formal letter to the U.S. Securities and Exchange Commission (SEC) demanding that it complete its review of the application to convert Grayscale Digital Large Cap Fund LLC (GDLC) into a spot ETF. This fund is an investment in five cryptocurrencies: Bitcoin, Ethereum, Solana, Cardano, and XRP. According to Grayscale, the regulator’s delay is causing losses to both the company and its investors.
The SEC previously gave preliminary approval, but immediately suspended the process of converting GDLC into an ETF. Bloomberg Intelligence analysts put forward two possible reasons for the delay: either the SEC has questions about Grayscale’s product itself, or the commission is developing a new regulatory framework for altcoin spot ETFs.
The company’s letter contains a statement saying that the delay in the public launch of the fund is harmful to Grayscale and its investors. The company is considering filing a motion to lift the stay imposed by Rule 431(e) so that the fund can begin operating immediately while the internal review of the application continues.
Grayscale cites Section 19(b)(2)(D) of the Exchange Act, which sets a strict deadline for reviewing such applications — no more than 240 days. On July 1, 2025, the 239th day from the date of filing, the SEC’s Division of Trading and Markets approved the conversion of the GDLC, but further delays, according to Grayscale’s lawyers, are already contrary to the law. The commission has not yet officially commented.
The GDLC conversion application was filed on October 15, 2024. A month and a half later, Bitwise filed a similar request, which also plans to create a spot crypto ETF. If approved by the SEC, Grayscale's product will most likely become the first of such funds.
Thus, Grayscale continues to insist on an early decision from the regulator, emphasizing that further delays cause economic damage and slow down the development of the crypto investment market. The future of mixed ETFs combining several digital assets depends on the SEC's decision, which many industry players are expecting.
