On September 17, local time, the U.S. Securities and Exchange Commission (SEC) "accelerated approval" of the Generic Listing Standards for cryptocurrency exchange-traded funds (ETFs), paving the way for related products to enter public issuance and trading.

I. Universal Listing Standards: From “Case-by-Case Approval” to “One-Click Listing”

Previously, listing a crypto ETP was a lengthy, expensive, and high-risk process. Issuers were required to submit a special application for each new asset, demonstrating sufficient market liquidity and immunity from manipulation. The SEC review process could take as long as 240 or even 270 days.

The impact of universal listing standards is revolutionary:

• Simplified and accelerated process: As long as ETPs meet certain requirements clearly defined by the SEC, their approval will be virtually guaranteed, and the process time will be significantly reduced to 75 days or less. This will allow compliant crypto ETPs (Exchange Traded Products) to be listed and traded without the need for Form 19b-4.
• Exchange Options: Most industry proposals suggest that universal listing standards should require that the underlying asset must have a futures contract traded on a regulated U.S. futures exchange. Eligible exchanges include CME, Cboe, and potentially even Coinbase Derivatives Exchange and Bitnomial.
• The first beneficiaries: The SEC has approved the exchange listing standards and quickly approved the trading of Grayscale Digital Large Cap Fund (mainly holding BTC, ETH, etc.).

Explosive Product Growth: History Repeats Itself

Matt Hougan, Chief Investment Officer at Bitwise, predicts that universal listing standards will trigger an explosion in the number of crypto ETPs, and history supports this view:

• Precedent for Traditional ETFs: Immediately after the SEC passed “Rule on ETFs” in late 2019, creating common standards for stock and bond ETPs, the rate of new ETF launches more than tripled, soaring from an average of 117 per year to 370 per year.

• Crypto Market Expectations: We anticipate a similar expansion in the crypto ETP sector. Altcoins eligible for futures contracts, such as Solana, XRP, Chainlink, Cardano, Avalanche, and Polkadot, will all see ETPs, attracting a significant number of traditional asset management firms to enter the space.

3. Double Macro Positives: The Superposition of Interest Rate Cuts and the ETP Wave

The regulatory breakthrough for ETPs comes at a time when US macroeconomic policy is shifting:

• Fed Shift: The Fed announced an interest rate cut on the same day, with Powell calling it a "risk-management cut" and explicitly stating that the labor market "does not need to soften further." This marks a shift in the Fed's policy focus from controlling inflation to protecting employment, and is expected to usher in a cycle of interest rate cuts amidst ample liquidity.
• Liquidity and channels: The interest rate cut cycle will release more capital to flow into risky assets; and the ETP universal standard provides the most convenient channel to access this capital.

IV. Impact on Cryptoasset Prices

Matt Hougan, chief investment officer at Bitwise, said in his report that the existence of ETPs itself does not guarantee capital inflows, but it prepares the asset for a "breakout."

1. Unlocking Traditional Capital: The vast majority of the world's capital is controlled by traditional investors. With ETPs, these investors can easily allocate crypto assets through their brokerage accounts without having to deal with complex wallets and private keys.
2. Reduced Mystique: ETPs transform cryptocurrencies from "geek-only, unfamiliar tokens" into trusted stock tickers. This lowers the barrier to entry and intimidation for average investors, making it easier to connect Chainlink with applications like Mastercard partnerships and stablecoins.
3. Capital Reservoir: ETPs are like a massive capital reservoir for assets. Once the fundamentals of an asset (e.g., Solana activity, Ethereum ecosystem development) begin to improve, capital will flow in at a rapid pace and on a massive scale, triggering rapid price increases.

In short, with the removal of SEC regulatory barriers and the start of the Federal Reserve's interest rate cut cycle, this "ETP explosion" will completely release suppressed crypto capital and innovation, and accelerate the mainstreaming of cryptocurrencies.