The US Securities and Exchange Commission (SEC) continues to weigh its approach to cryptocurrency investment products, delaying a decision on Cboe’s request to list options for Ether exchange-traded funds (ETFs) while reviewing Nasdaq’s filing to list Grayscale’s spot Hedera (HBAR) ETF.
Nasdaq Files for Grayscale’s Spot Hedera (HBAR) ETF Amid Growing Altcoin ETF Momentum
The Nasdaq Stock Market LLC has officially submitted a 19b-4 form with the US Securities and Exchange Commission (SEC) to list and trade Grayscale’s spot Hedera (HBAR) exchange-traded fund (ETF). This marks another significant development in the expanding landscape of cryptocurrency ETFs, as institutional demand for digital assets continues to rise.
The filing, made on Monday, is part of the two-step process required to propose a crypto ETF for regulatory approval. Once the SEC acknowledges the submission, it will be published in the Federal Register, initiating a structured review process by the agency.
This latest move by Nasdaq comes just a week after the exchange submitted a similar filing for Canary Capital’s spot HBAR ETF. The back-to-back applications indicate growing interest in Hedera (HBAR) as an investment-grade asset and suggest that the altcoin ETF market is quickly evolving beyond Bitcoin and Ethereum.
Hedera Hashgraph is a decentralized public network that operates on a Hashgraph consensus mechanism, offering an alternative to traditional blockchain solutions. Unlike proof-of-work or proof-of-stake networks, Hedera’s unique consensus system provides faster transaction speeds, improved security, and lower fees.
Governance of the Hedera network is handled by a council of major industry players, including Google, IBM, Boeing, Deutsche Telekom, and LG Electronics. This corporate backing has given the project a level of legitimacy and institutional trust that many other cryptocurrencies struggle to achieve.
Bloomberg’s Senior ETF Analyst, Eric Balchunas, has noted that Hedera and Litecoin currently hold the best odds of securing SEC approval for their respective spot ETFs. Given their advanced progress in regulatory discussions, these altcoin ETFs may be among the first approved beyond Bitcoin (BTC) and Ethereum (ETH).
Following the reelection of Donald Trump, the SEC has seen an influx of crypto ETF filings. This shift signals renewed optimism that a crypto-friendly regulatory landscape is emerging, which could lead to approvals for a variety of altcoin ETFs.
In addition to HBAR, issuers have already filed for spot ETFs tied to:
Solana (SOL)
XRP (XRP)
Cardano (ADA)
Litecoin (LTC)
Dogecoin (DOGE)
Recently, the New York Stock Exchange (NYSE) also filed a 19b-4 form for Bitwise’s Dogecoin ETF, further fueling speculation that regulators may greenlight altcoin-based ETFs in the near future.
Will the SEC Approve Hedera’s ETF?
While Bitcoin spot ETFs received their long-awaited approval in January 2024, altcoin ETFs still face regulatory hurdles. The SEC has historically been hesitant to approve non-BTC/ETH crypto products due to concerns over market manipulation, liquidity, and security compliance.
However, with increasing institutional demand and Wall Street’s growing involvement in crypto, many experts believe that the first altcoin ETF approvals could arrive by mid-2025.
Analysts predict that HBAR’s strong governance model and transparent compliance efforts could make it an attractive candidate for approval, potentially paving the way for broader altcoin ETF adoption.
Nasdaq’s filing for Grayscale’s HBAR ETF marks another milestone in the race to bring altcoin ETFs to the US market. With major exchanges like Nasdaq and NYSE backing these proposals, and regulatory attitudes shifting post-election, the chances of seeing more diverse crypto investment products are steadily increasing.
The SEC’s decision on Grayscale’s HBAR ETF could set a precedent for future altcoin ETFs. If approved, it may open the floodgates for a new wave of institutional crypto investments, further legitimizing digital assets as a mainstream financial instrument.
For now, all eyes remain on the SEC as the regulatory clock starts ticking on the latest round of crypto ETF applications.
SEC Delays Decision on Cboe’s Ether ETF Options, Pushing Final Ruling to May
Nasdaq’s filing of the Hedera ETF comes days after the SEC once again postponed its decision on whether to approve Cboe Exchange’s request to list options on Ether ETFs. In a regulatory filing dated Feb. 28, the agency extended its deadline until May, citing the need for additional time to review the proposal.
This marks the second delay for Cboe’s application, which was originally submitted in August 2024. The SEC had previously extended its review period in October, a move that signaled growing regulatory scrutiny over derivative products tied to cryptocurrency ETFs.
Cboe’s request specifically seeks to list options on the Fidelity Ethereum Fund (FETH), one of the most prominent Ether ETFs in the US market. According to VettaFi data, FETH has amassed around $1.3 billion in net assets, making it one of the leading Ethereum investment products available.
This delay mirrors the SEC’s Feb. 7 response to Nasdaq ISE, which also sought approval to list options tied to BlackRock’s iShares Ethereum Trust (ETHA). The iShares Ethereum Trust (ETHA) is currently the largest Ether ETF, boasting more than $3.7 billion in assets under management. The SEC has given itself until April to make a final ruling on that application.
Despite these delays, the demand for Ether ETFs continues to grow. Since Ethereum spot ETFs launched in July 2024, the sector has attracted approximately $11 billion in total net assets, signaling institutional investors' appetite for regulated Ethereum investment products.
The creation of an options market for ETH ETFs is widely seen as a critical step toward mainstream institutional adoption. Options are financial contracts that grant traders the right—but not the obligation—to buy (call) or sell (put) an underlying asset at a predetermined price. These instruments provide investors with flexibility in hedging, leverage opportunities, and additional risk management strategies.
The precedent for crypto ETF options was set in November 2024, when options trading began for spot Bitcoin ETFs. On its first trading day, options contracts on BlackRock’s iShares Bitcoin Trust ETF (IBIT) saw an impressive $2 billion in total exposure, showcasing robust market demand. A similar response is expected for Ethereum ETF options, should the SEC eventually approve them.
While the SEC remains cautious about expanding ETF-linked derivatives, the broader crypto derivatives market continues to evolve. Investment managers argue that the expansion of cryptocurrency ETF options in the US could accelerate institutional adoption and unlock significant upside potential for investors.
The SEC’s stance on Ethereum ETF options comes at a time when other crypto derivative products are gaining traction.
On Feb. 19, Coinbase launched Solana (SOL) futures, adding another major digital asset to the growing list of tradeable crypto derivatives.
On Feb. 28, the Chicago Mercantile Exchange (CME) Group announced its plans to launch SOL futures contracts on March 17, pending regulatory approval.
The Trump Administration’s Pro-Crypto Policies Could Influence the SEC’s Decisions
One factor that could influence the SEC’s decision-making process is the Trump administration’s increasingly pro-crypto stance. Since his reelection, President Donald Trump has repeatedly stated his intention to make the US the “world’s crypto capital.”
His administration has already begun appointing crypto-friendly officials to key financial regulatory positions, fueling speculation that the SEC could speed up approvals for a variety of crypto financial products, including ETF-linked options.
With the SEC now targeting May for a decision on Cboe’s Ether ETF options and April for a ruling on Nasdaq ISE’s application for BlackRock’s ETH ETF options, the market remains in a state of anticipation.
A favorable decision could signal a major milestone for Ethereum adoption, unlocking new avenues for institutional investors and improving liquidity in the crypto derivatives market. Conversely, further delays or outright denials could stall momentum for ETH derivatives, potentially slowing institutional inflows into the Ethereum ecosystem.
For now, all eyes remain on the SEC, as the crypto industry awaits clarity on the future of Ethereum ETF options trading in the US.
