The United States Securities and Exchange Commission (SEC) has expedited approval for Bitwise Asset Management's hybrid Bitcoin-Ethereum exchange-traded fund (ETF). Announced on January 30, 2024, the SEC filing indicated that the ETF's asset allocation will mirror the relative market capitalizations of Bitcoin and Ethereum. This marks a significant development in the landscape of crypto-based financial products, highlighting the SEC's evolving stance under the Trump administration amidst Bitwise's ongoing call for clearer regulatory guidelines.

A recent survey conducted by Bitwise among approximately 430 financial advisors in the United States reveals that clearer regulations are the primary factor that would increase comfort in allocating to cryptocurrencies, with 55% of advisors citing regulatory concerns.

Additionally, 42% identified better education as a key determinant in shaping their investment decisions.

The Bitwise ETF is structured to track the spot prices of Bitcoin and Ethereum, with asset allocation reflecting their market dominance. As of the filing date, the composition stands at approximately 83% Bitcoin and 17% Ethereum. The ETF will also maintain cash reserves to ensure liquidity and stability, with Coinbase providing custody services.

Bank of New York Mellon will function as the cash custodian, administrator, and transfer agent. The ETF will be listed on NYSE Arca, representing an integrated approach to investing in leading cryptocurrencies.

This hybrid model caters to both institutional and retail investors, facilitating diversified crypto investments without the complexity of managing separate assets.

The SEC's reduced approval timeline of 45 days for this ETF, compared to the standard 240-day period, underscores a transformation in its regulatory perspective on cryptocurrencies. Notably, the longstanding lawsuit between Ripple Labs and the US SEC, which began in December 2020, has vanished from the SEC's website.

This removal is fueling speculation in the crypto community about the lawsuit's potential termination under the new SEC leadership following the Trump Administration, possibly signaling a broader strategic shift.

These developments invite further exploration into the evolving regulatory environment and the opportunities it presents for market participants.