XRP News Today: Institutional Crypto Race Heats Up: 21Shares Challenges Canary in Altcoin ETF Battle

21Shares, a leading Swiss cryptocurrency asset manager, has submitted a registration statement to the U.S. Securities and Exchange Commission (SEC) to launch a spot Exchange-Traded Fund (ETF) tracking the native token of the Sei Network, SEI [1]. The proposed 21Shares SEI ETF would allow investors to gain exposure to the token while potentially earning additional yield through staking rewards, marking a new phase in the expansion of institutional-grade crypto investment products [2]. This follows a growing trend of altcoin ETF filings, particularly in the wake of the successful launches of Bitcoin and Ethereum ETFs in 2024, and as the U.S. regulatory environment appears to shift toward greater acceptance of digital assets [3].

The Sei Network, launched in August 2023, is a high-speed blockchain designed for trading applications, with SEI serving as its primary utility and governance token [2]. According to the filing, the 21Shares SEI ETF will primarily aim to track the performance of SEI tokens, while also exploring the potential for secondary income generation via staking. However, the firm has not yet concluded whether staking can be legally integrated into an ETF structure due to ongoing regulatory uncertainties [1]. The proposed fund will utilize Coinbase Custody Trust Company as its primary custodian and CF Benchmarks for pricing data, ensuring transparency and reliability in asset tracking [2].

This ETF filing places 21Shares in direct competition with Canary Capital, which submitted its own SEI ETF application in May 2025 [1]. Both applications highlight the potential for staking rewards, though Canary Capital has taken a more aggressive stance in its filing by explicitly including staking as a core feature. 21Shares, by contrast, is proceeding with a cautious approach, acknowledging the need for further regulatory clarity before finalizing its staking strategy [2]. The race between these two firms reflects a broader industry push to establish institutional access to altcoins, with the first-mover advantage expected to play a critical role in market share capture [3].

The regulatory landscape for crypto ETFs is currently undergoing significant development. The SEC has extended review periods for several altcoin ETF applications, with final decisions expected by October 2025 [1]. Analysts are optimistic about the likelihood of approvals, with some estimating a 90% chance for Solana and Litecoin ETFs, and 85% for XRP. The recent SEC guidance that most proof-of-stake staking activities fall outside the scope of securities law has further bolstered industry confidence [2]. This regulatory clarity is seen as a key factor in legitimizing staking-enabled funds and reducing legal uncertainties for asset managers [1].

As of the filing date, SEI holds a market capitalization of approximately $1.82 billion and ranks as the 74th largest cryptocurrency [2]. While the token has declined by 73% from its March 2024 peak of $1.14, its underlying network continues to expand, with total value locked (TVL) reaching over $669 million. The Sei Network is also undergoing a major upgrade known as “Giga,” which aims to increase transaction speeds to 5 gigabytes per second, further solidifying its position as a blockchain optimized for trading infrastructure [2]. If the ETF is approved, it would provide a regulated entry point for institutional and retail investors to access the Sei ecosystem through traditional brokerage accounts, potentially increasing the token’s liquidity and broader adoption [1].

The broader crypto ETF landscape continues to evolve, with 92 ETF applications currently awaiting SEC approval [4]. These include proposals for ETFs tracking Solana, XRP, Dogecoin, Cardano, and other major altcoins. The increasing number of applications signals strong demand from asset managers seeking to diversify crypto exposure beyond Bitcoin and Ethereum. With the SEC reportedly exploring streamlined approval processes—such as a 75-day automatic approval timeline if no objections are raised—expectations are high for a wave of approvals starting in October [3]. This development could signal a turning point in the institutional adoption of altcoins and expand the range of investment options available to traditional markets.

Source:

[1] 21Shares Seeks Launch of SEI ETF With Potential Staking (https://finance.yahoo.com/news/21shares-seeks-launch-sei-etf-053425300.html)

[2] 21Shares Files for SEI ETF with Staking Rewards as Altcoin ETF Race Heats Up (https://bravenewcoin.com/insights/21shares-files-for-sei-etf-with-staking-rewards-as-altcoin-etf-race-heats-up)

[3] Crypto Asset Manager 21Shares Files for Spot SEI ETF (https://cointelegraph.com/news/21shares-files-sei-etf-sec-filing-crypto-staking)

[4] 92 Crypto ETFs Now Await SEC Approval with Solana, XRP Leading Applications (https://finance.yahoo.com/news/92-crypto-etfs-now-await-130056606.html)