21Shares seeks SEC approval for a Sui Network ETF while Galaxy Digital confirms Nasdaq uplisting plans, highlighting institutional crypto adoption amid evolving global regulations.
Swiss fintech firm 21Shares submitted the first-ever SUI blockchain ETF application to the SEC on 2 July 2024, coinciding with Galaxy Digital’s confirmation of its Nasdaq listing finalization by mid-July, as institutional crypto products reach $92.3B in assets under management.
Specialized Blockchain ETFs Test Regulatory Boundaries
21Shares’ groundbreaking ETF proposal targets the Sui Network, a Layer 1 blockchain developed by former Meta engineers. The July 2 filing marks the first SEC application focused specifically on this decentralized platform, which processed over 65 million transactions in Q2 2024 according to its ecosystem dashboard.
Galaxy’s Nasdaq Move Signals Institutional Momentum
Michael Novogratz’s Galaxy Digital will complete its transition to the Nasdaq under ticker GLXY by 15 July 2024, according to a 28 June company statement. The move follows $387 million in Q1 institutional inflows reported in its earnings call, with dual listing arrangements maintaining TSX trading until 15 July.
Regulatory Hurdles Shape Global ETF Landscape
The SEC delayed decisions on BlackRock and Grayscale’s Ethereum ETF proposals to 18 July 2024, per 1 July filings. This cautious approach contrasts with Europe’s MiCA regulations that took full effect 30 June, requiring crypto ETF issuers to implement enhanced custody solutions and real-time transaction reporting.
Infrastructure Growth Supports Product Expansion
BlackRock and Coinbase announced expanded institutional access through Aladdin integration on 3 July 2024, enabling traditional asset managers to incorporate crypto into existing portfolios. This development follows CryptoCompare data showing crypto ETP/ETF assets reaching $92.3 billion on 1 July, with $4.1 billion Q2 inflows despite regulatory uncertainty.
Historical Precedents in Crypto Product Development
The current wave of specialized ETF applications echoes 2021’s Bitcoin ETF approvals, when the SEC authorized futures-based products after eight years of rejections. Like the current Sui Network proposal, those applications tested novel interpretations of existing securities frameworks, ultimately establishing new compliance benchmarks.
Regulatory Divergence Mirrors Past Tech Adoption Cycles
EU’s MiCA regulations continue a pattern seen in previous financial technology adoption, reminiscent of 2016’s PSD2 framework that standardized open banking. Just as those rules shaped Europe’s fintech landscape, MiCA’s custody and transparency requirements are forcing ETF issuers to redesign product architectures before submission.
