XRP News Today: SEC approves Bitwise spot crypto ETF but halts it over regulatory uncertainty

The U.S. Securities and Exchange Commission (SEC) has reignited uncertainty in the crypto market by first approving and then immediately pausing Bitwise Asset Management’s application to convert its 10-Crypto Index Fund into a spot crypto ETF. The reversal occurred on July 23, 2025, marking the second time this year the SEC has vacillated on crypto fund approvals, following a similar delay of Grayscale’s Digital Large Cap Fund earlier in the year. Bitwise’s proposed ETF, which tracks a weighted basket of 10 major cryptocurrencies including Bitcoin, Ethereum, XRP, Solana, and Polkadot, had been positioned as the first multi-asset spot crypto ETF in the U.S. The agency cited “political uncertainty” and “lack of listing standards” as reasons for the reversal, according to CoinCodex [4].

The SEC’s initial approval on the same day was swiftly followed by a stay under Rule 431, a procedural tool allowing regulators to delay a fund’s effective date for further review. Bitwise expressed initial enthusiasm for the approval but is now evaluating the implications of the reversal. A company spokesperson stated, “We’ve been encouraged by the constructive engagement with the SEC under the new administration,” while acknowledging the “new development” as a challenge [1]. The SEC’s Division of Trading and Markets had previously delayed the fund’s launch in May 2025, pending broader regulatory review [6].

Industry analysts note that the SEC’s inconsistent approach—approving and then reversing decisions—has created regulatory ambiguity. One commentator described the agency’s actions as sending “mixed signals” about its stance on crypto products, potentially deterring institutional participation [8]. The SEC’s internal debates reportedly center on whether existing ETF frameworks, designed for traditional assets, adequately address crypto-specific risks such as custody challenges and market volatility. This mirrors prior delays in Grayscale’s GBTC conversion proposal, which remains unresolved [7].

While some analysts view the pause as a temporary setback, others warn it underscores the SEC’s struggle to balance innovation with investor protection. The agency has emphasized the need for a “comprehensive framework” for crypto products but has yet to finalize such a framework. Critics argue this approach—approving then delaying key products—erodes market confidence and credibility. Bitwise, which previously received conditional approval, is now assessing the next steps but has not yet issued a public response.

The outcome of this case could set a precedent for future crypto ETF applications, as the SEC weighs internal policy reviews and external pressures from lawmakers and market stakeholders. For now, the pause highlights the regulatory hurdles in a rapidly evolving asset class.

Sources:

[1] [“SEC Pauses Bitwise Crypto ETF Just After Approval”](https://www.cryptoninjas.net/news/sec-pauses-bitwise-crypto-etf-just-after-approval-whats-behind-the-shock-decision/)

[4] [“SEC’s Sudden Reversal Pauses Bitwise ETF Conversion”](https://coincodex.com/article/70554/sec-bitwise-etf-conversion-halted/)

[6] [“Bitwise Gets XRP ETF Approval from SEC, But Trading Halted”](https://coinpedia.org/news/bitwise-gets-xrp-etf-approval-from-sec-but-trading-halted/)

[7] [“'Bizarre': ETF with XRP Exposure Hits Major SEC Roadblock”](https://www.tradingview.com/news/u_today:35a188eb5094b:0-bizarre-etf-with-xrp-exposure-hits-major-sec-roadblock/)

[8] [“SEC Approves, Then Halts Bitwise Crypto Index Fund ETF Conversion”](https://defi-planet.com/2025/07/sec-approves-then-halts-bitwise-crypto-index-fund-etf-conversion/)