The approval of spot Bitcoin ETFs by the U.S. Securities and Exchange Commission (SEC) in early 2024 marked a watershed moment for the digital asset industry. Since then, financial institutions have filed a series of applications for ETFs tracking other major cryptocurrencies. This article explores the most notable cryptocurrency ETF applications that could be approved in 2025 and analyzes their potential effects on market dynamics.
Major Cryptocurrency ETF Applications and Approval Probabilities
Solana (SOL) ETF – 99% Probability
Multiple asset managers, including Grayscale, Invesco, and Galaxy Digital, have submitted applications for a spot Solana ETF. In late June, REX Shares announced its Solana staking ETF, designed to track SOL’s performance while generating yield through on-chain staking.
The SEC has begun engaging with applicants, requesting updated S-1 filings, which analysts interpret as a sign of progress. Polymarket prediction data suggests a 99% probability of approval by the end of 2025.
XRP ETF – 85% Probability
XRP has gained significant ETF traction following Ripple’s improved regulatory outlook. Hashdex launched the first spot XRP ETF on Brazil’s B3 exchange, while Purpose Investments and 3iQ introduced similar products on the Toronto Stock Exchange.
Several major firms, including Grayscale, Bitwise, and 21Shares, have filed for U.S. spot XRP ETFs. With Ripple’s legal challenges subsiding, the path to approval appears clearer. Prediction markets indicate an 85% likelihood of an XRP ETF launch in 2025.
Polkadot (DOT) ETF – 90% Probability
21Shares filed for a spot Polkadot ETF with the Nasdaq exchange in March. Although the SEC has delayed its decision, pushing the final review deadline to July 2025, Bloomberg analysts assign a 90% probability of approval.
Avalanche (AVAX) ETF – 90% Probability
VanEck and Grayscale have both submitted applications for spot Avalanche ETFs. The SEC has acknowledged these filings but has postponed its decision. Despite delays, industry experts remain optimistic, with a 90% predicted approval rate.
Cardano (ADA) ETF – 90% Probability
Grayscale filed for the first spot Cardano ETF in early 2025. While the SEC has deferred its ruling, analysts believe there is a 90% chance an ADA ETF will be approved by year-end.
Other Notable Applications
- Litecoin (LTC) – 82% probability
- Dogecoin (DOGE) – 75% probability
- Sui (SUI) – 60% probability
- Hedera (HBAR) – 90% probability
Additional filings have been made for ETFs tied to SEI, PENGU, TRX, NEAR, APT, and AXL, though their approval probabilities are less certain.
How ETF Approvals Could Influence Crypto Markets
The introduction of multiple cryptocurrency ETFs could significantly alter market structure and investor behavior.
Increased Liquidity and Mainstream Adoption
ETF approvals typically attract institutional capital, enhancing market liquidity and stability. The Bitcoin and Ethereum ETFs demonstrated how regulated products can open new investor bases. A wave of new crypto ETFs would further legitimize the asset class and encourage broader adoption.
Potential for an “Altcoin Season”
Analysts like Eric Balchunas and Michaël van de Poppe suggest that approving altcoin ETFs could trigger a major altcoin bull market. Positive anticipation often leads to pre-approval price surges, as seen with Bitcoin. If several ETFs are approved, a so-called "altcoin summer" could follow, with increased trading volumes and market capitalization across various cryptocurrencies.
Regulatory and Market Maturity
The SEC’s careful approach reflects growing regulatory clarity. Each approval sets a precedent, making it easier for subsequent applications to gain acceptance. This evolving framework supports long-term industry growth and stability.
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Frequently Asked Questions
What is a cryptocurrency ETF?
A cryptocurrency ETF is an exchange-traded fund that tracks the value of one or more digital assets. It allows investors to gain exposure to cryptocurrencies without directly purchasing or storing them.
Why are so many crypto ETFs being proposed now?
The successful launch of Bitcoin and Ethereum ETFs proved there is significant demand for regulated crypto investment vehicles. Asset managers are now expanding into other major cryptocurrencies to meet investor interest.
How do ETF approvals affect crypto prices?
Approval often leads to increased demand as new investors enter the market. This can drive up prices both in anticipation of and following an ETF launch.
Can U.S. investors access these ETFs today?
Most of these products are still under review by the SEC. However, some non-U.S. investors can already trade XRP and Solana ETFs in markets like Canada and Brazil.
What risks are involved with crypto ETFs?
Like all investments, crypto ETFs carry market risk, regulatory uncertainty, and volatility. It’s important to research each product and understand its structure and underlying assets.
Will ETF approvals guarantee a bull market?
Not necessarily. While ETFs can boost demand and liquidity, market cycles are influenced by many factors, including macroeconomic conditions and technological developments.