Grayscale and NYSE Arca have filed an application with the US Securities and Exchange Commission (SEC) to list a spot Cardano (ADA) exchange-traded fund (ETF), adding to the growing wave of digital asset funds seeking regulatory approval for ETFs.
The proposed product, named Grayscale Cardano Trust, would be the asset manager’s first standalone ADA investment vehicle.
The filing, submitted on 10 February, designates Coinbase Custody Trust Company as the custodian and BNY Mellon Asset Servicing as the administrator.
If approved, this would introduce a new avenue for institutional and retail investors to gain exposure to Cardano without directly holding the cryptocurrency.
The submission comes at a time when the SEC remains hesitant about greenlighting altcoin-based ETFs, despite increased pressure from the industry.
Regulatory hurdles for Cardano ETF
The SEC’s approach to crypto ETFs has been marked by cautious progression, particularly concerning altcoins.
Grayscale’s push for a spot Cardano ETF follows its recent amendment to convert its Solana Trust into a spot ETF—an application acknowledged by the SEC on 6 February.
The timing of the Cardano filing coincides with broader shifts in the US regulatory landscape. Following US President Donald Trump’s return to office, asset managers have intensified efforts to bring more crypto-related products to market.
The commission’s reluctance to approve altcoin ETFs—evident in its previous handling of Solana and XRP filings—suggests that the fate of the Grayscale Cardano Trust remains uncertain.
Additionally, NYSE Arca’s proposal underlines the increasing competition among US exchanges and financial institutions seeking a foothold in the expanding crypto ETF space.
If successful, this ETF would allow market participants to trade ADA in a regulated environment, potentially boosting liquidity and price stability for the asset.
Altcoin ETF filings on the rise
Grayscale is not alone in its efforts to introduce altcoin ETFs. On 30 January, NYSE Arca filed a 19b-4 request to convert Grayscale’s XRP Trust into a spot ETF.
The move was followed by Cboe BZX Exchange’s 6 February submission for four asset managers—Canary Capital, WisdomTree, 21Shares, and Bitwise—to list the first spot XRP ETFs in the US.
Similarly, 21Shares, Bitwise, VanEck, and Canary Capital are competing to launch spot Solana ETFs, with Cboe BZX refiling applications on their behalf on 28 January.
These developments indicate that major financial players are aggressively pursuing regulatory approval to expand their crypto ETF offerings, particularly in the altcoin segment.
Despite these filings, the SEC has yet to signal a shift in its stance toward altcoin ETFs. Regulatory concerns primarily revolve around liquidity, market manipulation, and investor protection.
Will the SEC approve a Cardano ETF?
If the Grayscale Cardano Trust secures SEC approval, it could serve as a precedent for other altcoin-based ETFs, reshaping institutional engagement with digital assets beyond Bitcoin.
Given ADA’s market position as a top ten cryptocurrency, its inclusion in a regulated ETF would provide traditional investors with a new avenue for exposure.
The SEC’s cautious approach suggests that approval is far from guaranteed, especially as policymakers assess the broader implications of allowing altcoin ETFs.
For now, the fate of spot Cardano ETFs hinges on the SEC’s evolving stance, making this a pivotal moment for institutional crypto adoption.
If approved, it could accelerate the integration of digital assets into traditional markets, offering investors a new way to engage with the cryptocurrency ecosystem.
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