The cryptocurrency industry urges the U.S. SEC to avoid implementing a one-size-fits-all restriction on new ETFs

According to Cointelegraph, participants in the crypto industry such as a16z, Grayscale, and the Crypto Council for Innovation (CCI) urged the U.S. Securities and Exchange Commission (SEC) to avoid implementing a one-size-fits-all restriction on "novel" exchange-traded funds (ETFs) and instead assess them based on individual risk parameters. Three comment letters were submitted on August 31, just as the SEC's 60-day window for public comments on the regulation of new ETFs was nearing its end. The SEC launched this consultation on June 30, seeking opinions on whether existing regulations are sufficient, how such funds should be regulated, and whether the registration process needs adjustments.

a16z believes that crypto-based ETPs have now benefited from more mature market infrastructure, including exchange-approved listing standards and established disclosure requirements, and therefore should not be grouped with products that hold private assets or adopt other novel strategies. Grayscale similarly argues that digital asset products with mature compliance and disclosure records should not face new portfolio conditions or disclosure regimes simply because they are classified as "novel." CCI called for comparable regulatory efficiency between ETFs and non-ETF ETPs while retaining existing investor protection measures.

There is widespread opposition to potential regulatory adjustments that could impose additional requirements or delay product launches, but there are differences in classification, approval processes, and terminology. The dispute over the ETF label is particularly pronounced: a16z proposed that the term ETF be used only for funds under the Investment Company Act of 1940, while Grayscale believes that ETFs should describe economic characteristics rather than legal shells.