Bitcoin News Today: "Bitwise Challenges SEC with Staking-Free Chainlink ETF Design"

Bitwise Asset Management has filed with the U.S. Securities and Exchange Commission (SEC) to launch the first-ever U.S.-listed spot exchange-traded fund (ETF) for Chainlink (LINK), a decentralized oracle network token. The proposed ETF aims to mirror the spot price of LINK through the CME CF Chainlink-Dollar Reference Rate and would hold the token directly, with Coinbase Custody Trust Company serving as the custodian and Coinbase Prime as the execution agent. The fund will offer both cash and in-kind creation and redemption options for investors, and notably, the filing does not include any provision for staking, a move that aligns with the SEC's recent guidance that staking on proof-of-stake networks is not classified as a securities transaction [1].

The filing marks a significant step in the U.S. crypto ETF landscape, which has so far been dominated by Bitcoin and Ethereum-based products. If approved, the Bitwise Chainlink ETF would represent the first U.S.-listed ETF tied to an oracle network token and expand the range of digital asset exposure available to institutional and retail investors. Chainlink, which launched in 2019, has become a critical infrastructure component for decentralized finance (DeFi), gaming, tokenization, and cross-chain initiatives. Its technology enables smart contracts to access reliable off-chain data and has been integrated with major financial institutions, including central banks [1].

LINK currently trades at $23.42, placing it as the 13th largest cryptocurrency by market capitalization. Despite this, it has declined by over 50% from its peak in 2021. The proposed ETF seeks to address growing demand for diversified crypto exposure, as global crypto ETFs have attracted nearly $30 billion in inflows this year, with assets under management exceeding $150 billion. Europe already offers Chainlink-related products, such as exchange-traded products (ETPs) from firms like 21Shares and VanEck, but the U.S. market remains the largest potential market for such products [1].

The regulatory environment for altcoin ETFs remains uncertain, despite the SEC’s approval of spot Bitcoin and Ethereum ETFs. Bitwise’s design of the fund—limiting it to a straightforward 100% LINK holdings, a single custodian, and no staking—suggests a strategic effort to streamline the approval process. However, the outcome is not guaranteed, and the SEC’s response could influence the future trajectory of altcoin ETFs in the U.S. [1].

Bitwise’s move follows a broader trend of crypto ETF diversification. The firm has pending applications for ETFs tied to other cryptocurrencies, including XRP, Solana, Dogecoin, and Aptos, while Grayscale has also filed to convert its Avalanche Trust into a spot AVAX ETF. These developments indicate that the crypto ETF market is evolving beyond its initial focus on Bitcoin and Ethereum, with potential implications for institutional adoption and capital inflows into the broader crypto ecosystem [1].

Source: [1] JUST IN: Bitwise Files for First-Ever Chainlink Spot ETF (https://coinpedia.org/news/just-in-bitwise-files-for-first-ever-chainlink-spot-etf/) [2] Bitwise Files for $LINK Spot ETF (https://coinpedia.org/crypto-live-news/bitwise-files-for-link-spot-etf/) [3] Bitwise Bitcoin Standard Corporations ETF (OWNB) (https://www.nasdaq.com/market-activity/etf/ownb) [4] Bitwise Bitcoin ETF | What is BITB? (https://www.bitget.com/price/bitcoin/etf/bitb)