SEC Greenlights Grayscale’s Game-Changing Multi-Crypto ETF: Bitcoin, Ethereum, and XRP Get Institutional Stamp of Approval

The SEC just dropped the mic on crypto regulation—Grayscale's multi-asset ETF got the nod, bundling Bitcoin, Ethereum, and XRP under one institutional umbrella. Wall Street's about to get a crash course in volatility.

Three tokens, one ETF: The trifecta of crypto's heavyweights now has a golden ticket to mainstream portfolios. Bitcoin for store-of-value purists, Ethereum for the DeFi crowd, and XRP for the compliance-minded. The ultimate diversification play—or a regulatory Trojan horse?

Behind the scenes: Grayscale's win signals the SEC's reluctant embrace of crypto's inevitable institutionalization. TradFi brokers will now pitch 'managed exposure' while quietly sweating over 24/7 trading windows.

The cynical take: Nothing makes regulators move faster than the scent of fresh fees—just don't mention last cycle's 80% drawdowns during the sales pitch.

TLDR

• SEC approved Grayscale’s Digital Large-Cap Fund conversion to an ETF, featuring Bitcoin (80.2%), Ethereum (11.3%), XRP (4.8%), Solana (2.7%), and Cardano (0.81%)
• The approval follows Grayscale’s legal victory in 2023 when a judge ruled the SEC was “arbitrary and capricious” in denying their Bitcoin ETF conversion
• SEC is considering allowing crypto ETFs to launch without 19b-4 filings, which could streamline future approvals
• Analysts estimate 95% probability for Solana and XRP ETF approvals by end of 2025
• The conversion marks the end of arbitrage opportunities that existed with Grayscale’s previous trust structure

The Securities and Exchange Commission approved Grayscale’s request to convert its Digital Large-Cap Fund into an exchange-traded fund on Tuesday. This decision creates a new investment vehicle that combines five major cryptocurrencies into a single regulated product.

🚨BREAKING: The SEC has just approved the conversion of Grayscale's Digital Large Cap trust into an ETF.

It includes Cardano (ADA), ethereum (ETH), Solana (SOL), XRP & BTC pic.twitter.com/2LsenSkb3i

— Coin Bureau (@coinbureau) July 1, 2025

The fund tracks the CoinDesk Five Index and includes the largest cryptocurrencies by market capitalization. Bitcoin makes up over 80 percent of the fund’s weighted allocation, while Ethereum accounts for 11.3 percent of holdings.

XRP represents 4.8 percent of the fund, with Solana holding 2.7 percent and Cardano comprising 0.81 percent. The fund offers investors exposure to multiple digital assets without requiring direct cryptocurrency ownership.

Grayscale’s conversion eliminates previous arbitrage opportunities that existed with its trust structure. Investors previously exploited premiums and discounts to net asset value to generate profits from price differences.

These arbitrage windows existed due to lock-up periods and the absence of in-kind redemptions in the trust format. The ETF structure removes these limitations and aligns the fund’s trading price more closely with its underlying assets.

Legal Victory Paves Way for Approval

Grayscale’s path to ETF approval began with a legal challenge in June 2022. The company petitioned federal court after the SEC denied its Bitcoin trust conversion application.

The legal battle lasted approximately one year before reaching resolution. In August 2023, a federal judge ruled that the SEC acted in an “arbitrary and capricious” manner when denying the conversion request.

This court victory forced the SEC to reconsider its position on cryptocurrency ETFs. Grayscale’s bitcoin trust subsequently became an ETF, though it carries a 1.5 percent expense ratio making it the most expensive Bitcoin ETF available.

The legal precedent established by this case influenced the SEC’s approach to future crypto ETF applications. Bloomberg ETF analyst James Seyffart noted that the approval could pave the way for additional multi-asset crypto ETFs.

Regulatory Changes Could Accelerate Future Approvals

The SEC is considering procedural changes that could streamline crypto ETF approvals. The agency may allow crypto ETFs to launch without requiring 19b-4 filings, which currently mandate lengthy review processes.

This potential shift represents part of broader discussions between the SEC and exchanges. The goal involves establishing standardized listing procedures for cryptocurrency-based exchange-traded products.

If implemented, these changes could accelerate the approval timeline for future crypto ETFs. Fund managers WOULD gain faster market access for new cryptocurrency investment products.

The regulatory momentum has increased analyst confidence in pending applications. Bloomberg analysts estimate a 95 percent probability that solana and XRP ETF proposals will receive approval by the end of 2025.

Several single-token ETF applications tracking individual cryptocurrencies are currently under SEC review. The approval of Grayscale’s multi-asset fund may influence decisions on these pending applications.

Grayscale filed an amended S-3 registration statement as part of the approval process, indicating active dialogue with regulators. ETF Store President Nate Geraci had predicted approval success due to favorable regulatory momentum for crypto ETFs.