JP Morgan has expressed doubts regarding the Securities and Exchange Commission (SEC) approving additional cryptocurrency exchange-traded funds (ETFs), particularly those involving tokens beyond Bitcoin (BTC) and Ethereum (ETH)

JP Morgan analyst Nikolaos Panigirtzoglou highlighted that the SEC’s approval process for Ethereum ETFs was already stretched, given the ambiguity surrounding whether Ethereum should be classified as a security.

Panigirtzoglou told The Block that the SEC has not shown an aggressive stance towards approving crypto ETFs. He emphasized that the SEC's cautious approach is rooted in the lack of legislative clarity regarding the status of most cryptocurrencies. 

"We doubt the SEC would go even further by approving Solana or other token ETFs given their stronger opinion that tokens outside Bitcoin and Ethereum should be classified as securities," Panigirtzoglou stated.

Legislative Hurdles

The absence of legislation that clearly defines most cryptocurrencies as non-securities remains a significant barrier to further SEC approvals. Panigirtzoglou suggested that such legislation could change the regulatory landscape and pave the way for broader ETF approvals. 

However, he acknowledged that no such legislation currently exists, making it improbable for the SEC to approve ETFs for tokens like Solana in the near future.

Divergent Market Opinions

Despite JP Morgan’s skepticism, Geoffrey Kendrick from Standard Chartered Bank anticipates that Solana and XRP ETFs could be approved by 2025. This optimism contrasts with Panigirtzoglou’s cautious outlook. 

Additionally, Jaret Seiberg from TD Cowen suggests that more crypto ETF offerings could emerge within a year, potentially encompassing a variety of crypto tokens. 

On May 23, the SEC approved the 19b-4 forms of eight spot Ethereum ETF applicants, including Grayscale, Bitwise, BlackRock, VanEck, Ark 21Shares, Invesco, Fidelity, and Franklin. This approval was executed in one unified order, with S-1 registrations for these ETFs still pending SEC sign-off. Analysts expect these funds to begin trading in the coming weeks.