SEC wants better ETF procedures for crypto and prediction markets

The US financial watchdog SEC admits that its crypto policy in the past did not go well. According to an SEC official, the agency is now working on a better and more orderly process for handling crypto-related ETF applications. The goal: to create more clarity in a field that is growing with innovative products such as prediction markets.

SEC official Brian Daly reveals in an exclusive interview that the agency receives approximately 200 ETF applications per month. These include innovative products that the watchdog was previously critical of. The SEC is now working on streamlining these waves of applications.

New approach for innovative products

Daly indicates that the SEC is setting up a more robust approval process. An important part of this is confidential submissions of ETF applications. By handling some applications confidentially, the SEC tries to better protect innovation from imitation by other parties. This can prevent companies from quickly launching copies of newly approved products.

The SEC also acknowledges that the agency must learn to deal with relatively new market segments. Prediction markets, for example, pose a challenge for regulation that has not yet been fully refined for these products. The first steps of a structured approval process should reduce this uncertainty.

Restoring trust in the crypto sector

The SEC official emphasises that the agency made mistakes last year in dealing with crypto. The goal now is to restore trust in the sector and thereby also see the public better protected. By introducing more orderly processes, SEC officials hope that crypto innovation and regulation can work better together.

For ETF applicants, this will likely mean more clarity about what is and is not possible. At the same time, the accelerated processing of applications ensures that innovative products can come to light more quickly. The combination of these steps should ensure that the crypto world finally feels that regulatory uncertainty is decreasing.