The U.S. Securities and Exchange Commission (SEC) has postponed the evaluation process of XRP and Solana 
$143-based exchange-traded fund (ETF) applications by Franklin Templeton for an additional 35 days. This extension delays the decision necessary for these ETFs to trade on the Chicago Board Options BZX Exchange. Initially submitted in March 2025, the decision on these applications was first deferred in April by the SEC.
Evaluation and Commentary Process
On June 17, SEC opened the applications for public commentary, thereby creating additional time for the detailed examination of both the ETFs proposed and the exchange’s operations. The decision delay, part of traditional procedural evaluation, now extends the timeline with the final decision set back to July. Initial comments from the public concerning the application will be gathered within 21 days after being published in the Federal Register. Responses to these comments can be submitted within 14 days following this initial period. This process ensures that diverse opinions are considered in decision-making.
The SEC is soliciting public commentary to assess whether listing and trading shares of the Trust holding XRP is designed to prevent fraud and manipulation or reveals unanticipated concerns unexamined by the Commission.
ETF Design and Valuation Methods
The proposed XRP ETF aims to contain only XRP and cash equivalents. Its valuation method will employ the CME CF XRP-Dollar Reference Rate. Meanwhile, for the Solana (SOL) ETF, a proposal has surfaced to stake SOL assets, suggesting that declining staking rewards could mirror the impact of losing stock dividends. The evaluation by the SEC proceeds under the 6(b)(5) section of the Securities Exchange Act of 1934, emphasizing fraud prevention and investor protection. The SEC’s announcement reinforces that the initiation of an investigation does not imply any reached conclusion on the matters involved.
Market Expectations and International Developments
While the approval status of the ETF applications remains unclear, there exists positive anticipation within the market. Related markets are closely observing these developments. Notably, an XRP-based ETF began trading on the TSX exchange in Canada on June 18, garnering international attention and sparking discussions about similar products in the U.S.
The outcome of Franklin Templeton’s applications, coinciding with a period when regulatory frameworks are being established, could influence other companies’ motivations for similar applications. Additionally, the SEC’s approaches and public opinions will likely play crucial roles in shaping the final decision.
There remains uncertainty regarding the regulatory approval of the new ETF products. Decisions by the SEC, along with public comments, hold the potential to shape the future of cryptocurrency-based financial products in the United States.
The approach to regulating investment funds and protecting investors is critically important for the widespread trading of crypto assets in financial markets. The SEC’s final decision could mark a new era for both investors and the financial sector. This process, open to public commentary, can serve as an example of transparency and participation within the industry. Investors, however, are encouraged to carefully consider risks and opportunities when ETF applications are approved or denied.
