Delay in US Securities and Exchange Commission's Decision on Polkadot and Hedera Exchange-Traded Funds
Chillin' with Crypto ETFs: Polkadot and Hedera Await SEC's Green Light
It's been a game of cat and mouse between the U.S. Securities and Exchange Commission (SEC) and a couple of eager crypto enthusiasts hoping to launch exchange-traded funds (ETFs) based on Polkadot (DOT) and Hedera (HBAR). The SEC has taken a cooling-off period, pushing back its decision on these proposed funds a tad longer—giving it more time to mull over the proposals and hear from the public.
As per the SEC's filing, it's deemed necessary to stretch the review period. It wants to take its sweet time to fully digest the proposed rule change and the matters it raises. In other words, it needs more time and feedback from the public before making a definitive choice. Originally, the SEC was marked to give its decision by June 11, but it has now extended its review timeline.
In their proposals, Grayscale has proposed converting its Polkadot Trust into an ETF, and Canary Capital aims to list its Canary HBAR ETF on Nasdaq. Both applications were initially submitted back in February 2025.
Now, these proposals find themselves in a more advanced stage of the approval process known as proceedings to determine approval or disapproval. This phase allows the SEC to gather additional data and public insight before finally rendering its verdict.
Should Canary's proposal come to fruition, its ETF would hold Hedera's native token, HBAR, and cash. Its value would be tracked using the CoinDesk Hedera USD CCIX 30min NY Rate, a benchmark derived from prices sourced from major crypto trading platforms. Each share would be exchangeable in blocks of 10,000 and could be purchased or sold via cash or in-kind transactions.
This isn't the first time the SEC has applied the brakes on these filings. Earlier, the SEC made similar deadline extensions. It can prolong its decision up to four times before arriving at a conclusion. The subsequent major deadline for these ETFs lands on September 9, 2025.
Both Canary and Grayscale, alongside other crypto ETF applicants, have been making a ruckus, urging the SEC to adopt a "first-to-file, first to approve" approach. They claim that such a strategy would foster fairness and competition by granting priority to early filers. As of now, the SEC's response to their request remains cryptic. However, if the SEC does adopt this approach, Canary's HBAR ETF, being the first on the list, might score an edge over Grayscale's later submission.
Stay tuned as we continue monitoring this crypto cat-and-mouse game! Meanwhile, interested readers may find our recent article on the "CLARITY Act" crypto bill, which garnered approval from U.S. lawmakers, highly informative.
(Insights from Enrichment Data: The Polkadot and Hedera ETFs are still under the SEC's reconsideration, facing no immediate approval as the agency continues to seek further public input. Experts now believe that any approvals for crypto ETFs, including these, are more likely to happen in the fourth quarter of 2025 rather than earlier, as the SEC has also shown a similar delay in deciding on related proposals like the Canary Spot SUI ETF.)
The SEC's delayed decision on the proposed exchange-traded funds (ETFs) based on Polkadot (DOT) and Hedera (HBAR) has caused a delay in their potential approval, with the next major deadline set for September 9, 2025. Crypto ETF applicants, including Canary and Grayscale, are advocating for the SEC to adopt a "first-to-file, first to approve" approach, which could potentially give Canary an edge due to their earlier submission. As both ETF proposals are currently in the proceedings to determine approval or disapproval, further public input is being sought by the SEC for a more informed decision, possibly implying approvals more likely in the fourth quarter of 2025. The finance industry and investing community are closely watching this technology-driven cat-and-mouse game for future developments in the cryptocurrency space.
