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US SEC hits pause on Grayscale crypto ETF conversion

The Block

Jul 02, 2025 20:52:02

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The U.S. Securities and Exchange Commission put a pause on converting the Grayscale Digital Large Cap Fund LLC a day after agency staff greenlit the fund to begin trading. 

In a letter sent to the New York Stock Exchange on Wednesday, SEC Deputy Secretary J. Matthew DeLesDernier said the agency's Division of Trading and Markets granted that approval, but said the commission would review it. 

"In accordance with Rule 431(e), the July 1, 2025 order is stayed until the Commission orders otherwise," the SEC said in the letter. "The Office of the Secretary will notify you of any pertinent action taken by the Commission."

The SEC approved Grayscale's proposal to convert another one of its closed end funds into an ETF on an "accelerated basis" on Tuesday. The fund trades over the counter for accredited investors and is composed primarily of bitcoin at almost 80% and Ethereum at about 11%. Solana, Cardano, and XRP are also represented with single-digit percentages, according to its website.

Grayscale did not immediately respond to a request for comment. An SEC spokesperson declined to comment on any individual fund. 

The SEC is also weighing dozens of proposals for crypto ETFs from ones tracking SOL to XRP to DOGE.

Disclaimer: The Block is an independent media outlet that delivers news, research, and data. As of November 2023, Foresight Ventures is a majority investor of The Block. Foresight Ventures invests in other companies in the crypto space. Crypto exchange Bitget is an anchor LP for Foresight Ventures. The Block continues to operate independently to deliver objective, impactful, and timely information about the crypto industry. Here are our current financial disclosures.

© 2025 The Block. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

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