21Shares spot SUI ETF remains pending as SEC reviews rules for altcoin ETFs

The US Securities and Exchange Commission (SEC) has opted to delay its verdict on the 21Shares Spot SUI ETF. Such delays often indicate that the regulator wants to examine a proposal in greater detail before issuing a ruling.

On behalf of the asset manager, Nasdaq had lodged a Form 19b-4 with the SEC on May 23, requesting permission to list and trade the fund’s shares.

Since then, the regulator has extended the review period on July 22 and formally launched proceedings to determine if the SUI ETF meets the requirements for approval. It even invited the public to share written feedback, including opinions, data, and concerns on the proposal.

The US SEC has to decide on the 21Shares SUI ETF by December 21

Nasdaq had filed for the SUI ETF shortly after a major attack on Cetus that drained over $223 million and disrupted the Sui ecosystem. Nonetheless, the exchange’s team acted quickly, locking down $160 million in stolen funds and offering a $6 million reward for the recovery of the rest.

The company noted at that time, “With the funds secured, Cetus has officially entered the next phase of the recovery process. Our team is fully mobilized and working around the clock to execute the roadmap we shared earlier — from contract upgrades and liquidity restoration to preparations for relaunch.”

After that, the Sui network confirmed the hack was due to a flaw in Cetus’s math library, not its own infrastructure or programming language. It also unveiled a $10 million fund to bolster ecosystem security.

The SEC’s decision to delay the approval of the SUI spot ETF, according to some analysts, could dampen short-term confidence, as it delays the institutional participation and market expansion opportunities tied to the ETF. 

Nevertheless, the commission must make a final decision on the 21Shares SUI ETF by December 21, but could greenlight it as early as October, potentially in tandem with other altcoin ETFs.

So far, 21Shares and Canary Capital are the only asset managers to seek approval for a Sui ETF, with CBOE filing Canary’s application last month.

Analysts believe SEC delays are part of its strategy

The SEC, in August, also postponed its verdict on Grayscale’s request to incorporate staking into its ETH fund, as well as on 21Shares’ spot Ethereum staking proposal and Grayscale’s spot Dogecoin ETF filing. Additionally, it chose to extend its review period for Bitcoin and Ethereum ETFs proposed by Truth Social, the social platform owned by Trump Media & Technology Group.

Nonetheless, Nate Geraci of NovaDius Wealth previously shared that he believes an SEC decision on ETF staking could be imminent, after the commission stated that specific liquid staking arrangements do not involve securities.

Analysts Eric Balchunas and James Seyffart of Bloomberg also suggested that the SEC’s recent delays are part of a deliberate strategy to develop a unified approval framework for digital-asset ETFs. Seyffart explained that this framework would set out common listing standards, specifying which assets are eligible for inclusion and the approval criteria, eliminating the need for a separate order for each filing.

Meanwhile, the three major exchanges, Nasdaq, NYSE, and CBOE BZX, remain in discussions over standardized rules for spot crypto ETF listings with the SEC. As part of this effort, they filed amendments recently to strike “excluded commodities” from the definition of “commodity” in their listing standards.

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