SEC Halts Grayscale’s GDLC ETF Launch—XRP, Solana, Cardano Left in the Cold

The SEC just slammed the brakes on Grayscale's big crypto ETF play—leaving XRP, Solana, and Cardano investors out in the cold. Here's why it matters.

Regulatory Ice Age Hits Crypto

No warm welcome for digital assets this time. The SEC's latest move freezes Grayscale's GDLC ETF debut, a fund designed to track top tokens beyond Bitcoin and Ethereum. Guess 'innovation-friendly' only goes so far in Washington.

Three Coins Caught in Crossfire

XRP's legal limbo continues. Solana's speed gets throttled. Cardano's research-first approach? Doesn't buy regulatory goodwill. All three assets—each with billion-dollar market caps—now stuck waiting for Wall Street's stamp of approval.

Finance's Favorite Game: 'Hurry Up and Wait'

Another day, another delay in crypto's endless quest for mainstream legitimacy. The SEC's hesitation speaks volumes—they'll greenlight Bitcoin ETFs all day, but altcoins? That's a bridge too far (for now). Just don't hold your breath waiting for regulators to catch up to the tech.

Why Is The SEC Freezing The XRP And ADA ETF?

GDLC currently holds roughly $755 million, dominated by Bitcoin (≈80 %) and ether (≈11 %), but it is the roughly eight percent allocated across XRP, Solana and Cardano that makes the product the first multi-asset spot ETF to bundle tokens the SEC has not (yet) conceded are commodities. By contrast, Grayscale’s bitcoin trust (GBTC) converted without incident in January 2024, after the D.C. Circuit ordered the SEC to vacate its earlier denial.

Bloomberg Intelligence ETF analyst James Seyffart broke the news on X: “UPDATE: While @Grayscale was given an approval order for their conversion of $GDLC into an ETF yesterday, there was a letter attached to that approval that is putting a Stay on their ability to actually convert at this time.”

Seyffart sketched two, still-unconfirmed explanations. First, the Commission may be withholding all multi-coin launches until it finishes a comprehensive digital-asset ETP framework. “The SEC doesn’t want to let anything to launch under the 19b-4 process until they officially approve or come up with some framework for digital assets in the ETF wrapper. […] I assume the SEC didn’t want to deny it but for whatever reason they aren’t ready for a launch just yet.”

Second, an internal division other than Trading & Markets may have unresolved concerns about GDLC’s structure or disclosures. “The 2nd theory is that there’s something the SEC wants to work on in relation to a specific aspect of $GDLC itself (like its structure?) The 19b-4 approval order comes from the division of Trading & Markets. Perhaps another division isn’t ready to let this convert just yet,” Seyffart wrote via X.

His colleague Eric Balchunas echoed that reading: “The plot thickens. Upper level of SEC telling GDLC it can’t launch until otherwise notified. … My guess: They want to issue the crypto ETP listing standards before any ’33-Act spot ETFs hit market with these other coins.”

Rule 431 allows any Commissioner to pull an action approved by staff for plenary Commission review. The rule is procedural; it neither guarantees reversal nor sets a deadline. Historically, reviews have ranged from a few weeks to several months. Until the Commission votes, the staff order remains in limbo. Therefore, Seyffart concludes: “TLDR: It can’t convert *YET* but it will. We just don’t know when and we don’t exactly know why the SEC issued this ‘Stay’ order.”

Notably, Grayscale can submit legal briefs urging the Commission to affirm the staff approval; outside commenters may also file. The Commission may uphold, modify or overturn the order. Even if the approval survives, NYSE Arca cannot list GDLC until the stay is lifted.

At press time, XRP traded at $2.27.