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The U.S. Securities and Exchange Commission (SEC) is preparing for a significant milestone in the cryptocurrency world. Recent decisions indicate that approval for exchange-traded funds (ETFs) for altcoins, particularly those utilizing the Proof of Work (PoW) mechanism, may be imminent. With the nomination of new chairperson Paul Atkins, experts anticipate a swift progression in the approval process, potentially resulting in multiple altcoin ETF approvals in the second quarter of the year. However, dissenting voices regarding these developments are also emerging.
SEC Lays Groundwork for Altcoin ETFs: Notable Coins
In a press release on March 20, the SEC declared that cryptocurrencies using PoW mechanisms do not qualify as securities under U.S. laws. This statement implies that PoW-based cryptocurrencies, such as Bitcoin (BTC) 
$107,266, fall under the commodity category. The SEC emphasized that mining activities of this nature should not be viewed as “securities offerings and sales.”
This decision could mark a critical juncture for altcoins seeking ETF approvals. Litecoin (LTC) has already positioned itself as a strong candidate for approval. Following this development, applications for ETFs from other PoW-based altcoins, such as Monero (XMR) and Kaspa (KAS), may also surface.
However, the SEC’s focus is not limited to PoW-based altcoin projects. In February, the regulatory body announced that memecoins are also not considered securities. This announcement could pave the way for ETF applications for projects like Dogecoin 
$0.219128 (DOGE). The dismissal of the Ripple 
$2 case has maintained hope for Solana 
$172 (SOL) and XRP ETF applications, despite delays. The Commodity Futures Trading Commission’s approval of futures for XRP and SOL further enhances the likelihood of ETF approvals.
Crenshaw Critiques SEC’s Decision
SEC member Caroline Crenshaw publicly expressed dissent regarding the recent decisions. She argued that the announcement contains numerous legal loopholes, particularly stating that a Howey test should still be conducted to determine if mining activities qualify as securities. According to Crenshaw, the SEC’s decision lacks binding authority and does not provide complete protection for investors.
Crenshaw highlighted that there have been ten similar comment decisions in the past nine weeks. However, she avoided directly accusing other commission members of partiality towards cryptocurrencies. With her term nearing its end, despite her statements, it is likely these comments will become effective unless challenged in court. The SEC’s stance on cryptocurrencies has sparked significant divisions within the organization.
