Bitcoin News Today: Crypto ETF Flood Stalls as SEC Shutdown Leaves Market in Limbo

The U.S. Securities and Exchange Commission (SEC) faced an unprecedented surge in cryptocurrency exchange-traded fund (ETF) filings on October 4, 2025, as over 30 new applications were submitted in a single day. The filings, led by asset managers Rex Shares and Osprey Funds, included products tracking altcoins such as AAVE, LINK, AVAX, and Litecoin (LTC), with some incorporating staking features to generate yield for investors. This wave of filings followed the SEC's approval of streamlined generic listing standards in September, which replaced the cumbersome 19b-4 process and reduced approval timelines. Nate Geraci, president of NovaDius Wealth, described the event as "just the beginning," predicting a flood of crypto ETFs in the coming months.

The new SEC rules, proposed by exchanges like Nasdaq, NYSE Arca, and CBOE, allowed asset managers to bypass the lengthy 19b-4 review process for qualifying products. This shift accelerated the approval timeline for spot crypto ETFs from up to 240 days to as little as 60-75 days, provided the products met threshold requirements. Rex and Osprey filed 21 ETFs collectively, while Defiance ETFs LLC submitted leveraged products for Bitcoin and Ethereum. The filings underscored growing institutional interest in altcoins, with applications for staking-enabled ETFs-such as those targeting Solana (SOL) and XRP-highlighting innovative strategies to enhance returns.

However, regulatory delays persist due to the U.S. government shutdown, which began on October 1, 2025. The SEC's limited capacity during the shutdown stalled reviews of pending applications, including those for Litecoin, Solana, and XRP ETFs. Deadlines for decisions on older filings, such as the Litecoin ETF (due October 2) and XRP ETFs (due October 10), were effectively rendered moot. Analysts noted that the shutdown could extend for weeks, with traders on Polymarket assigning a 56% probability of a shutdown lasting until October 15. This uncertainty has left market participants in limbo, despite the surge in new filings.

The crypto ETF landscape is also marked by intense competition among issuers. Grayscale's Digital Large Cap Fund, approved under the new standards, became the first multi-crypto ETF to leverage the streamlined framework. Meanwhile, BlackRock's iShares Bitcoin Trust (IBIT) continued to dominate inflows, with $791.6 million in net inflows on October 4 alone, pushing total inflows to over $3 billion in five days. This momentum reflects broader investor appetite for regulated crypto exposure, particularly as Ethereum ETFs attracted $4 billion in institutional inflows in August, compared to $800 million in outflows for Bitcoin ETFs during the same period.

Looking ahead, the SEC's delayed decisions on staking-related ETFs and altcoin products have raised questions about regulatory priorities. While Geraci and others anticipate approvals for a wide array of crypto ETFs, including those for Dogecoin (DOGE) and Cardano (ADA), the agency's focus on custody, staking mechanics, and fraud risks remains a bottleneck. The approval of in-kind redemptions for ETFs in August 2025 signaled a step toward operational efficiency, but challenges remain for novel structures like staking-enabled funds.

The surge in filings and regulatory developments have positioned the U.S. as a key battleground for crypto ETF innovation. With 92 applications under review and 16 decision deadlines in October, the market is bracing for a potential explosion of products once the SEC resumes full operations. As Geraci emphasized, the floodgates for crypto ETFs are opening, and the next phase of approvals could redefine institutional access to digital assets.