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Grayscale

Every Crypto Coin Show story tagged Grayscale, newest first, alongside the guides and interviews that give it context.

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Grayscale files Zcash options-income ETF with biweekly payouts
ETF

Grayscale files Zcash options-income ETF with biweekly payouts

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Editor's ChoiceCrypto Coin Show News Team·September 26, 2026·3 min read

Grayscale has filed with the SEC for a Zcash options-income ETF that would pay shareholders every two weeks by selling short-dated call options rather than holding ZEC directly. The structure caps investor upside if Zcash rallies while still passing through the full downside, a trade-off institutional allocators evaluating crypto income products will need to weigh before the fund’s earliest possible December debut.

  • The filing reached the SEC on Friday, September 25, 2026, and could take effect 75 days later, in early December.
  • The fund must hold at least 80% of net assets in options on Zcash ETPs, not ZEC itself.
  • Grayscale’s spot ZCSH fund held $914.5 million in assets by September 18, up from about $260 million at its 2017-trust conversion.
  • 75 days Waiting period before the fund could launch, set for early December
  • $914.5M ZCSH spot fund assets, up from $260M at trust conversion
  • 2.50% ZCSH sponsor fee, which the new fund’s trading could indirectly boost

Grayscale asked the SEC on Friday (September 25, 2026) to register the ZCSH High Income ETF, a fund that pays out biweekly distributions built from option premiums rather than from holding Zcash. The filing, first reported by BeInCrypto, sets a standard 75-day review clock under Rule 485(a)(2), meaning the fund could go effective in early December if the SEC does not intervene. Grayscale announced the move in a post on X the same day.

Fund Skips Spot ZEC and Buys Options on Grayscale’s Own ETF

The ZCSH High Income ETF will not custody Zcash. Per the filing, it invests at least 80% of net assets in exchange-listed options that reference The Zcash ETF (ZCSH), Grayscale’s existing spot product, or an index of Zcash ETPs.

Exposure runs entirely through derivatives, meaning the fund’s returns can diverge from ZEC’s actual price.

Synthetic Covered Calls Trade Upside for Premium Income

The strategy is a synthetic covered call. The fund pairs bought call options with sold puts to replicate ZCSH’s price moves, then writes short-dated calls, mostly a month or less to expiration, to collect the premiums that fund distributions.

Selling those calls caps gains: if ZEC rallies past the strike price, the fund forfeits everything above it, while a falling market still hits the portfolio in full.

The filing is explicit that “high income” is a description of strategy, not a promise. It states the term “does not mean that the Fund will achieve any particular distribution rate, yield or level of income,” and warns that “the amount and character of the Fund’s distributions will vary,” with no assurance any payout level is sustained.

Some biweekly cash could simply return an investor’s own capital rather than genuine profit, the same caveat that applies to Grayscale’s existing Bitcoin covered call ETF and to the Bitcoin premium income fund Goldman Sachs filed in April.

Grayscale also discloses a related-party wrinkle: an affiliate of the fund’s adviser sponsors ZCSH and collects its fee, listed at 2.50% on Yahoo Finance’s fund page. The filing acknowledges the new fund’s options trading could lift demand for ZCSH shares and, indirectly, that affiliate’s fee revenue, a structure institutional due-diligence teams typically flag when an adviser’s derivatives product references its own sibling fund.

ZCSH’s Record Weekly Inflow Set Up the Income Trade

The underlying appetite for Zcash exposure is what makes the income wrapper viable. ZCSH converted from Grayscale’s 2017 trust with roughly $260 million in assets, began trading August 25, and saw its options launch September 8.

By the week ending September 18, assets had grown to $914.5 million after $271 million in cumulative inflows, with that week’s $98.2 million haul leading all crypto ETFs, according to BeInCrypto’s tracking.

Several filing details remain blank, including the new fund’s ticker, listing exchange, expense ratio and sub-adviser. Those omissions are standard for a preliminary 485(a) registration but leave open exactly how the fund will be priced and distributed once it clears review.

The CCS read. The real signal here is not the biweekly payout gimmick but how fast Grayscale is willing to spin derivatives products off a single-asset fund barely a month old. If ZCSH’s inflow pace holds, expect competitors to file copycat Zcash and altcoin income wrappers well before this one even reaches the market.

The SEC’s 75-day clock puts a decision point around early December, and Grayscale still needs to fill in the ticker, exchange listing, fee structure and sub-adviser before the fund can trade.

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Grayscale converts Bitcoin miners fund into AI infrastructure bet
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Grayscale converts Bitcoin miners fund into AI infrastructure bet

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AI NewsCrypto Coin Show News Team·September 23, 2026·4 min read

Grayscale Investments has renamed its Bitcoin Miners ETF (MNRS) into the Grayscale AI Compute ETF (GCPU), replacing an index built on block-solving with one built on data centers and power. The switch matters to institutional allocators because it converts a niche crypto-mining vehicle into a bet on AI infrastructure scarcity, a theme Goldman Sachs projects will draw more than $1 trillion in annual capital spending.

  • Grayscale renamed MNRS to GCPU on September 22, 2026, tracking the new Indxx High Performance Computing Index.
  • Roughly half of GCPU’s portfolio targets native GPU cloud and AI-hosting firms, the rest are miners and other HPC operators pivoting to AI.
  • North American data centers hold about six months of spare capacity, per CBRE, against a two-to-five-year timeline to build new facilities.
  • $1T Goldman Sachs’ projected annual AI capital spending figure
  • 6 months data center spare capacity versus years-long build times
  • 94% Riot Platforms’ 2026 stock gain versus 21% for AI-pivot miners broadly

Grayscale confirmed the change in a September 22, 2026 announcement, retiring the Indxx Bitcoin Miners Index in favor of the Indxx High Performance Computing Index. GCPU will not hold digital assets directly or track any coin’s price, according to the filing. Grayscale is instead packaging equity exposure to the physical buildout behind AI models, a trend first detailed by Cryptopolitan.

Grayscale Splits GCPU Roughly 50-50 Between AI-Native and Ex-Mining Firms

The new index captures what Grayscale describes as two distinct paths to compute capacity. About half the portfolio’s weight targets companies built around GPU cloud and AI-hosting from inception. The remainder consists of high-performance computing operators, including Bitcoin miners, that have publicly disclosed or executed a shift toward AI workloads.

The index rebalances quarterly, meaning miners that formalize AI contracts or expand hosting capacity can gain weight each quarter, while those that do not can lose it. That mechanical rule replaces the previous MNRS methodology, which weighted companies purely on mining output and hash rate regardless of revenue mix.

Vanourny Calls Compute the New Scarce Asset

Steve Vanourny, Grayscale’s Head of Index, framed the rebrand as an extension of the firm’s original digital-asset scarcity thesis rather than a departure from it.

“Grayscale has spent over a decade giving investors access to scarce, transformational technologies, such as digital assets, and we believe compute belongs in that same category. GCPU is a direct extension of that thesis, giving investors access to the companies closing the gap between AI’s demand for compute and the physical infrastructure needed to meet it.”

Steve Vanourny, Head of Index, Grayscale

Grayscale backs that scarcity argument with CBRE data showing North American data centers at record-low vacancy, with roughly six months of spare capacity in reserve. Building fresh capacity is not a fast fix; new facilities typically take two to five years to bring online. Goldman Sachs’ $1 trillion annual capex forecast, mostly directed at physical plant, underpins the case that supply cannot close the gap quickly.

What Changes in Practice for Miners That Cross Over

For crypto-native investors, the practical effect is that GCPU no longer functions as a Bitcoin mining proxy, even though several of its constituents still run mining operations.

Cryptopolitan’s reporting shows why the pivot pays: AI cloud services fetch a median of roughly $940 per megawatt-hour, against $113 to $179 for Bitcoin mining, and miners carrying AI or HPC contracts trade at about 12.9 times forward sales versus 3.7 times for those without.

TeraWulf is up near 73% year to date and Riot Platforms roughly 94%, while AI-integrated miners overall have gained about 21% against a broader Bitcoin market that has struggled. Core Scientific booked $136.7 million in colocation revenue in the second quarter of 2026, more than five times the $27.5 million it drew from mining in the same period.

The document Grayscale filed leaves one question unresolved for holders: what happens to constituents that announce an AI pivot but fail to execute it before the next quarterly rebalance.

OpenAI’s $280 Billion Compute Push Sets the Backdrop

Cryptopolitan’s analysis ties the miner repricing to a roughly $280 billion compute buildout tied to OpenAI and a 2,600-gigawatt U.S. grid interconnection backlog, conditions that make an already-permitted, grid-connected site more valuable than the mining rigs sitting inside it. That dynamic is already reshaping the mining sector beyond Grayscale’s index, with public miners collectively holding an estimated $70 billion to $100 billion in announced AI and HPC contracts.

Grayscale’s own MNRS-to-GCPU conversion effectively formalizes what miner management teams had already been telling shareholders on earnings calls.

The CCS read. Grayscale is not calling a bottom on Bitcoin mining economics, it is arbitraging a repricing that already happened in equity markets, where AI-contract miners trade at more than triple the multiple of pure hashers. For allocators who track bitcoin treasury strategies like the one covered in our report on Strategy’s bitcoin purchases, GCPU signals that public markets increasingly separate mining-as-coin-exposure from mining-as-infrastructure-exposure, and reward the latter.

The first quarterly rebalance under the new Indxx High Performance Computing Index methodology will show whether Grayscale’s roughly 50-50 split between AI-native firms and transitioning miners holds, or whether the fund tilts further from Bitcoin mining as more operators disclose AI contracts, a shift already visible in coverage of miners’ financing needs such as our report on crypto-backed lending trends.

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Grayscale executes 3-for-1 split of Zcash ETF after assets hit $500M
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Grayscale executes 3-for-1 split of Zcash ETF after assets hit $500M

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ETFCrypto Coin Show News Team·September 18, 2026·3 min read

Grayscale announced a 3-for-1 share split of its Zcash ETF (ZCSH), tripling each holder’s share count without altering their stake’s value. The move signals confidence in the first U.S. privacy-coin fund after assets surged past $500 million in less than a month following its August conversion from a trust structure.

  • Grayscale converted its Zcash Trust to the ZCSH ETF on NYSE Arca on August 25, becoming the first U.S. fund tracking a privacy coin.
  • Assets reached $500 million by early September, up from $260 million at launch, driven by $70 million in external inflows and a $100 million DCG allocation.
  • The 3-for-1 split takes effect September 30, with share distributions occurring after market close on September 29 for holders as of September 28.
  • $500M Assets under management by early September versus initial launch total.
  • 2.5% Annual fund fee, roughly ten times higher than spot Bitcoin ETF rates.
  • 550,000 ZEC coins held, representing close to 3% of total supply.

Grayscale announced on September 18 that it plans a 3-for-1 forward split of its Zcash ETF, with each shareholder receiving two additional shares for every one held at the close of business on September 28. Shares will distribute after market close on September 29, and post-split trading begins September 30. The move comes as Cryptopolitan first reported that Grayscale converted its long-running Zcash Trust into the ZCSH ETF, listed on NYSE Arca on August 25, marking the debut of the first U.S. fund tracking a privacy coin.

Grayscale’s Zcash fund grew to $500 million in five weeks after converting from trust

Assets under management surged past $500 million by early September, up from approximately $260 million at launch on August 25.

In a September 17 Medium analysis, Austin Liu broke down the composition: roughly $70 million came from fresh external inflows, while Digital Currency Group, Grayscale’s parent company, contributed a $100 million allocation through its DCG International Investments unit, indicating internal commitment to the fund’s success.

The fund charged a 2.5% annual fee, roughly ten times the management cost of spot Bitcoin ETFs, a premium that reflects the specialized nature of a privacy-coin vehicle.

By early September, the fund held more than 550,000 ZEC tokens, equal to nearly 3% of Zcash’s total supply. Coinbase Custody provides the underlying asset custody.

Holdings remain on transparent blockchain despite Zcash’s privacy option

Zcash enables users to choose between transparent addresses that operate similarly to Bitcoin and shielded addresses that obscure the sender, receiver, and transaction amount.

Liu noted that the ZCSH fund stores all its coins exclusively in transparent Coinbase wallets, making every token verifiable on the public blockchain, a choice that surrenders the privacy feature central to Zcash’s value proposition.

The decision reflects regulatory and operational constraints inherent to a U.S.-listed ETF structure rather than a limitation of the underlying asset.

Zcash price surge from $50 to $1,500 in a year shows investor appetite

Zcash traded near $50 one year ago and crossed $1,000 on September 4, then climbed to approximately $1,500 following a roughly 20% gain on Thursday. The momentum demonstrates institutional and retail appetite for privacy-focused digital assets, though the asset remains far smaller by market capitalization than Bitcoin or Ethereum and faces ongoing regulatory scrutiny in multiple jurisdictions.

The CCS read. We see the share split as a liquidity play ahead of potential retail inflows. Grayscale’s confidence in holding 3% of circulating supply suggests conviction that Zcash will remain a core privacy allocation within institutional portfolios, despite the regulatory headwinds privacy coins face globally. The fund’s rapid asset growth and corporate backing make it a proxy for institutional acceptance of privacy as a blockchain feature.

Institutional investors should monitor whether the split accelerates inflows or whether the $500 million base represents a ceiling under current regulatory uncertainty. The fund’s ability to attract assets beyond DCG’s internal capital will signal whether privacy coins can sustain institutional ETF vehicles in the U.S. market.

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Grayscale Just Made XRP 26% of Its New Portfolio for Advisors
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Grayscale allocates 26% of new advisor portfolio to XRP, excludes Bitcoin entirely

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XRPSeptember 14, 2026·3 min read

Grayscale’s new model portfolio for financial advisors allocates more than a quarter of assets to XRP while excluding Bitcoin entirely, signaling a significant shift in how the wealth management giant is packaging crypto exposure for institutional clients. The move tests whether advisors will treat the strategy as genuine diversification into emerging assets or as a concentrated bet on Ethereum and XRP masked by a multi-asset wrapper.

  • XRP comprises 26.11% of Grayscale’s Digital Assets Next Gen portfolio, the second-largest holding after Ether at 42.34%
  • The Grayscale XRP Trust ETF trades 38.51% below its launch price despite recent token strength near $1.42
  • Six of the model’s seven underlying funds are underwater, yet the portfolio shows a 30.69% net gain in five weeks of trading since July 27
  • 26.11% XRP allocation in Digital Assets Next Gen model portfolio
  • 38.51% Grayscale XRP Trust ETF decline from launch price
  • July 27 Launch date for the new Grayscale model portfolio strategy

Grayscale launched four model portfolios on September 14 to give financial advisors a turnkey crypto allocation strategy, with the Digital Assets Next Gen portfolio representing the firm’s most aggressive bet on emerging tokens. According to BeInCrypto’s reporting, the Next Gen model excludes Bitcoin entirely and concentrates roughly 89% of its assets across three holdings: Ether at 42.34%, XRP at 26.11%, and Solana at 21.09%. The portfolio rebalances every three months and caps any single asset at 40%, though Ether has already drifted past that ceiling since the model began trading on July 27. Grayscale charges no separate fee for the models themselves, with underlying funds averaging 0.23% in annual costs.

XRP’s Heavy Weighting Masks Significant Losses in Grayscale’s Trust Structure

The prominence of XRP in Grayscale’s new model portfolio contrasts sharply with poor performance in the firm’s dedicated XRP Trust ETF. The trust trades 38.51% below its launch price, and BeInCrypto reported in August that it sold $180 million in tokens during the first half of the year at a realized loss.

Six of the seven funds underpinning the model portfolio trade below their starting prices, creating a structural disconnect between the model’s reported gains and the actual performance of its component assets.

XRP itself traded near $1.42 on the announcement date, up roughly 5% for the day, but that intraday strength has not reversed the trust’s longer-term decline.

Grayscale’s decision to anchor Next Gen around Ether and XRP rather than the traditional Bitcoin-Ethereum-Solana trio used in other model portfolios signals confidence in a different allocation thesis.

However, the fund-level losses raise questions about whether the portfolio’s reported 30.69% net gain since July 27 reflects genuine momentum or is built largely on a single strong August with limited underlying data to support a sustained reversal.

Institutional Adoption Depends on Advisor Interpretation of “Emerging Assets”

Laurie Katz, Grayscale’s Global Head of Distribution, framed the model launch as a convenience play for advisors seeking to add crypto exposure without maintaining individual asset allocations. The pitch centers on simplicity: advisors can replicate Grayscale’s chosen weights across client accounts using the firm’s ETF suite.

Whether advisors treat Digital Assets Next Gen as a genuine emerging-asset strategy or as a concentrated Ethereum-XRP bet repackaged for institutional consumption will determine how much capital flows into the model.

The model’s zero separate fee structure removes one barrier to adoption, but the fund-level underperformance raises due diligence questions that advisors will likely scrutinize.

Grayscale’s broader lineup includes Digital Assets Core Plus, focused on established assets including Bitcoin, Ethereum, Solana, and Chainlink’s broader institutional infrastructure, signaling that the firm is testing multiple portfolio philosophies simultaneously. The Next Gen strategy’s exclusion of Bitcoin is notable given Grayscale’s historical strength in Bitcoin products and suggests the firm believes advisors are ready to allocate meaningfully beyond the largest asset class. Grayscale caps rebalancing at quarterly intervals, meaning the portfolio will remain overweight Ether relative to its 40% ceiling until the next adjustment window, potentially driving performance divergence between the model and its advertised weights.

The Next Gen model’s true test will emerge in Q4 when Grayscale executes its first quarterly rebalance and advisors decide whether to commit material client assets to the strategy. The combination of XRP’s inclusion, Bitcoin’s absence, and the XRP Trust’s underwater valuation creates a complex narrative for advisor presentations, success depends on whether institutional clients view this as an informed diversification play or a redemption opportunity for assets Grayscale accumulated at higher prices.

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Grayscale launches HYPG Hyperliquid ETF, HYPE continues to defy BTC weakness
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Grayscale launches HYPG Hyperliquid ETF, HYPE continues to defy BTC weakness

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BitcoinJune 3, 2026·5 min read

Grayscale has launched HYPG, a Hyperliquid staking ETF on Nasdaq with a 0.29% fee, the lowest among competing HYPE ETFs, as the HYPE token defies broader crypto weakness and captures $132 million in net inflows during May alone. The move signals institutional appetite for yield-bearing crypto products and intensifying fee competition among major asset managers racing to capitalize on Hyperliquid’s explosive growth.

  • Grayscale HYPG charges 0.29% fee, undercutting 21Shares’ 0.30% and Bitwise’s 0.34% on competing Hyperliquid ETFs launched within three weeks
  • HYPE token reached record high near $76 this week while Bitcoin fell below $67,000, with Hyperliquid-linked ETFs capturing $132 million net inflows in May
  • HYPE market cap now sits at $16.1 billion, ranking 9th among cryptocurrencies, surpassing Dogecoin as protocol generated $857 million revenue in 2025
  • 0.29% Grayscale HYPG fee compared to competing Hyperliquid ETF fee structures
  • $132M Cumulative net inflows to Hyperliquid ETFs during May versus record outflows from Bitcoin and Ether funds
  • $16.1B HYPE market capitalization placing token 9th among cryptocurrencies by market value

Grayscale Investments has entered the accelerating race for Hyperliquid market share by launching HYPG on Nasdaq, positioning its staking-enabled ETF as the lowest-cost option among three competing U.S. listed products that debuted within a three-week window.

The 0.29% management fee undercuts 21Shares’ THYP, which launched May 12 at 0.30%, and Bitwise’s BHYP, which debuted May 15 with a temporary zero-fee promotional window before settling at 0.34%. This compressed fee structure reflects genuine institutional demand for exposure to Hyperliquid, a decentralized perpetual futures protocol that has expanded into smart contracts and tokenized assets since launching in 2024.

The rapid consecutive launches by three major asset managers signal that the Hyperliquid ecosystem has matured enough to support multiple competing products targeting different investor segments.

Unlike traditional crypto ETFs that simply hold tokens, HYPG actively participates in Hyperliquid’s staking mechanism, earning yield that flows into the fund’s net asset value.

Grayscale cited historical staking yield averaging 2.2% per year based on data from May 2025 through April 2026, according to stakingrewards.com. This yield-generating structure differentiates staking ETFs from plain spot holdings, offering institutional investors a tax-efficient vehicle to capture protocol rewards without managing private keys or navigating custody arrangements independently.

The fee war erupting across these three ETFs, with a mere 0.05% separating Grayscale from 21Shares, demonstrates that issuers view the addressable market as large enough to justify aggressive pricing despite razor-thin margins on flows. Each manager is betting that capturing early adopters will build sticky assets before the market consolidates around one or two dominant products.

HYPE Surges to Record High While Bitcoin Stumbles

The HYPE token reached a record near $76 earlier this week, trading around $72 at press time, while Bitcoin declined below $67,000, a roughly 3% drop in 24 hours. This divergence underscores HYPE’s decoupling from broader crypto market movements, a pattern rarely seen in altcoins during periods of Bitcoin weakness.

Over the same period, the newly launched HYPE ETFs captured this momentum with precision: THYP gained approximately 75% since its May 12 debut, and BHYP rose about 60% from its May 15 launch, according to Stocktwits data.

Hyperliquid-linked ETFs pulled in more than $132 million in cumulative net inflows during May, a period when both Bitcoin and Ether ETFs experienced record outflows.

The inflow contrast is striking: while traditional crypto ETFs endured significant capital redemptions, Hyperliquid products attracted fresh institutional capital at scale. This suggests that sophisticated investors are actively rotating exposure from passive holdings into yield-generating products tied to specific protocols with genuine revenue generation.

HYPE’s ability to attract inflows despite Bitcoin’s stumble indicates that the token’s value proposition, tied directly to Hyperliquid’s growing usage and buyback mechanics, has developed independent momentum from macro crypto sentiment.

HYPE’s market capitalization now stands at $16.1 billion, advancing past Dogecoin to claim 9th place among cryptocurrencies by market value. This ranking reflects pure market consensus rather than brand recognition alone, positioning Hyperliquid as a top-ten asset within a decade of launch.

The speed of this ascent has caught the attention of institutional allocators who track protocol fundamentals closely, particularly those evaluating alternatives to established derivative platforms.

Hyperliquid Protocol Generated $857 Million Revenue in 2025

Hyperliquid generated approximately $857 million in protocol revenue during 2025, according to Grayscale’s announcement. Nearly 99% of this revenue flows directly into HYPE buybacks rather than developer salaries or treasury diversification, creating a direct mechanical link between network usage and token value.

This buyback-heavy model differs sharply from traditional platforms that distribute revenue across operational expenses, marketing, and founder compensation, instead returning nearly all economic value to token holders.

The buyback mechanism creates a powerful incentive structure: as trading volume grows and fees accumulate, the protocol automatically purchases and holds HYPE on behalf of stakers, supporting the token’s price and distributing value without requiring token sales or dilution.

This approach appeals strongly to institutional investors accustomed to analyzing cash flows and buyback yields in traditional equities markets. Hyperliquid’s model translates familiar corporate finance concepts into decentralized protocol economics, lowering the conceptual barrier for institutional portfolio managers unfamiliar with crypto-native governance structures.

The protocol’s willingness to direct 99% of revenue back to the token holder base rather than operational expenses differentiates it from most Layer-1 blockchains and derivative platforms.

For HYPG investors, this revenue model matters directly because staking yields and token appreciation are mathematically linked to platform growth. As Hyperliquid expands market share in perpetual futures trading, generates additional revenue from smart contract fees, or adds new tokenized assets, the buyback flow increases automatically.

Institutional investors can model HYPE’s potential value based on trading volume growth, similar to how they analyze exchange stocks or betting platform equities. This fundamental framework has attracted analysts who previously dismissed crypto as speculative or yield-free.

Three ETFs Competing for Market Leadership Within Weeks

The rapid-fire launch sequence, 21Shares on May 12, Bitwise on May 15, and Grayscale entering the market afterward, reveals extraordinary institutional appetite for Hyperliquid exposure through regulated, custody-free vehicles.

Each manager bet independently that market demand justified product development costs, suggesting internal conviction that Hyperliquid’s growth trajectory justifies prominent positioning within crypto-focused allocations.

The compressed timeline also reflects that these firms maintain standing distribution and compliance infrastructure enabling quick product launches once they confirm demand signals.

Bitwise’s initial decision to waive fees entirely signals willingness to absorb near-term margin erosion in exchange for rapid asset gathering and competitive positioning. The move mirrors strategies used in passive index ETF launches, where managers accept temporary losses to capture market share before fee compression settles at equilibrium.

By introducing a zero-fee window, Bitwise forced competitors to choose between matching the promotion or ceding early market momentum, a tactic that accelerates price discovery on sustainable fee levels across the category.

The current fee structure, ranging from 0.29% to 0.34%, suggests that the market will stabilize around 30 basis points or slightly lower once initial flows peak. This compares favorably to Bitcoin spot ETF fees, which have compressed toward 0

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SEC halts Bitwise crypto index ETF same day it advanced the filing
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SEC halts Bitwise crypto index ETF same day it advanced the filing

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ETFCrypto Coin Show News Team·July 23, 2025·3 min read

The SEC halted Bitwise’s crypto index ETF approval after initially advancing it, marking a pattern of regulatory reversals that raises questions about the agency’s stance under new leadership. The pause signals potential shifts in how the regulator will handle institutional crypto fund applications going forward.

  • SEC Assistant Secretary Sherry R. Haywood paused Bitwise’s approval on July 22, citing Rule 431 reconsideration procedures and suspending the order pending further SEC review.
  • The Bitwise 10 Crypto Index ETF holds Bitcoin, Ethereum, XRP, Solana, and Polkadot weighted by market capitalization, trading under ticker BITW.
  • The halt follows a similar reversal with Grayscale’s Digital Large Cap Fund, which the SEC approved for ETF conversion then immediately suspended, signaling broader institutional crypto fund review uncertainty.
  • July 22 Date the SEC’s Division of Trading and Markets advanced Bitwise’s application before halting it same day
  • 240 days Current maximum review period for exchange 19b-4 crypto ETF filings under existing rules
  • 80% Bitcoin allocation in Grayscale’s Digital Large Cap Fund, with Ethereum at approximately 11 percent

The SEC reversed course on Bitwise’s crypto index fund approval within hours of advancing it on Tuesday, July 22. In a letter, Assistant Secretary Sherry R. Haywood invoked Rule 431 of the Commission’s Rules of Practice to suspend the application and signal the agency would reconsider the filing. The Bitwise 10 Crypto Index ETF, which trades as BITW, weights positions in Bitcoin, Ethereum, XRP, Solana, and Polkadot according to market capitalization and aims to track a broad crypto basket for institutional investors.

SEC pauses Bitwise after advancing it, citing Rule 431 reconsideration review

The agency’s reversal stands out not for its substance but for its speed and timing. Haywood’s letter stated that under Rule 431(e), the order from July 22 would remain paused until the SEC determined otherwise, providing no explicit rationale for the delay. This creates uncertainty for Bitwise and investors tracking the application, as the reconsideration process has no published deadline.

The Bitwise halt mirrors a near-identical reversal involving Grayscale’s Digital Large Cap Fund LLC, which the SEC approved for conversion from a closed-end fund to an ETF on an accelerated timeline, then suspended the same order a day later.

Grayscale, which allocates approximately 80% of assets to Bitcoin and 11% to Ethereum alongside smaller positions in Solana, Cardano, and XRP, has stated it continues engaging with regulators on a listing timeline.

Pattern of reversals raises questions under SEC Chair Paul Atkins’ new leadership

The consecutive halts have sparked debate among ETF analysts and crypto fund strategists about the SEC’s true intentions.

Scott Johnsson, a general partner at Van Buren Capital, argued that the SEC moved to stop the process either to avoid complications from Democratic Commissioner Caroline Crenshaw, who has expressed skepticism of crypto assets, or to avoid adding deadlines to the proposals. James Seyffart, an ETF analyst, rejected both explanations as insufficient under SEC Chair Paul Atkins and predicted the agency would continue delaying approvals until it devised a comprehensive framework for crypto ETF listings.

Seyffart suggested the SEC may be building toward a formal crypto ETF listing standard, a structured approach that could accelerate future approvals by replacing the current 240-day maximum review period under the 19b-4 filing process with a shorter, defined timeline.

Neither Bitwise nor the SEC responded to requests for comment on the halts or the underlying rationale.

The CCS read. We see the reversals as institutional leverage: by pausing rather than denying, the SEC keeps Bitwise and Grayscale negotiating while signaling that approvals now depend on SEC staff alignment, not automatic process completion. The real test is whether Atkins’ mandate to support crypto innovation translates into published listing standards or remains advisory.

Watch for the SEC’s next move on whether Bitwise’s paused order lifts unchanged, undergoes material revision requirements, or settles under a new formal crypto ETF framework that Seyffart predicted the agency is building, a decision that will set the template for other institutional fund applicants including Solana and Dogecoin ETF proposals currently under agency review.

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