The U.S. Securities and Exchange Commission (SEC) is working on a simplified approval process for cryptocurrency exchange-traded funds (ETFs) that aims to significantly reduce the time it takes to get approvals.

This new framework may allow issuers to bypass the traditional Form 19b-4 requirement, enabling them to file an S-1 registration and wait only 75 days for approval.

Under this proposed system, quicker listings for token-based ETFs could be granted if the assets meet specific criteria such as market size and trading volume.

However, the eligibility standards for tokens under this new framework remain unclear, with speculation surrounding minimum thresholds for market capitalization, liquidity, and trading volume.

Analysts are optimistic, predicting a 95% likelihood that spot ETFs for cryptocurrencies like XRP, Solana, and Litecoin will gain approval by late 2025, expanding investment options beyond Bitcoin and Ethereum.

The potential approval of U.S.-listed altcoin ETFs could attract new capital into altcoin markets, potentially triggering an altcoin rally.

Currently, there are over 70 pending altcoin ETF applications, and this new approach could facilitate multiple approvals if several altcoins meet the new standards.

The proposed changes could replace the current requirement for each spot crypto ETF to obtain a Commission order before listing, streamlining the approval process.

This shift would focus primarily on the S-1 filing, potentially establishing a consistent 75-day review period, which would enhance predictability in the approval timeline.

A broad standard could also pave the way for multi-asset portfolios and staking-based structures, thereby increasing the diversity of offerings in the crypto ETF market.

Despite the anticipated changes, the SEC has postponed decisions on several pending crypto ETF applications, with many final deadlines set for the latter half of 2025.

Grayscale's multi-crypto ETF is expected to be approved shortly, which may open the door for single-asset funds in the near future.