Bloomberg Intelligence analyst James Seyffart examines the remarkable success of ETFs Bitcoin (CRYPTO:BTC) on the spot market and potential issues with altcoin ETF approvals in 2025.
What happened: During an episode of Blockworks Macro, Seyffart highlighted that four Bitcoin ETFs are now in the top 20 ETF launches of all time, with iShares (NASDAQ: IBIT) leading the way.
He highlighted that these ETFs attracted $37 billion in net inflows in their first year, far exceeding initial estimates of $15 billion to $20 billion.
Seyffart also noted the promising launch of Bitcoin ETF options, which could pave the way for a robust ETF derivatives ecosystem.
Altcoin ETF: ‘When, not if’
Despite his optimism that altcoin ETFs will be approved under a more cryptocurrency-friendly government, Seyffart warned of the risk of delays in the process.
He stressed that approval is a matter of “when, not if”, but hurdles remain, particularly for assets like Solana (CRYPTO: SOL), which the SEC has previously classified as securities.
-Seyffart added that regulatory headwinds, while milder under President Joe Biden, could further slow altcoin ETF timelines.
Also read: Bitcoin ETFs enter 2025 after a successful first year
Challenges in approving altcoin ETFs
- Lack of futures: Unlike Bitcoin and Ethereum ETFs, which have benefited from CME futures, altcoins like Solana do not have such instruments. The SEC may have to rely on Supervisory Sharing Agreements (SSAs) with exchanges, complicating the approval process.
- SEC Litigation and Classification: Ongoing lawsuits against cryptocurrency exchanges and the SEC’s classification of some altcoins as securities add another layer of complexity to the process. ETF filings for Solana, for example, were met with indirect denials as the SEC failed to acknowledge wrongdoing due to internal conflicts.
Seyffart suggested that while a new leader could speed up ETF approvals, a time frame of 240 to 260 days is most realistic. He remains optimistic about the future regulatory environment for crypto products, predicting fewer headwinds in 2025.
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