Bitwise Files For Stablecoin And Tokenization ETF, Says SEC Shift May Unleash Crypto ETF Boom

Bitwise has filed for a stablecoin and tokenization ETF after predicting that new Securities and Exchange Commission (SEC) listing rules could unleash a “flood’’ of crypto funds.

The proposed ETF (exchange-traded fund), called Bitwise Stablecoin & Tokenization ETF, will track an index of stablecoin issuers, infrastructure firms, exchanges, payment processors, and regulated crypto ETPs (exchange-traded products with Bitcoin and Ethereum exposure), according to a filing.

It will be split evenly between equities tied to stablecoins and tokenization, and crypto assets. The largest crypto ETP in the crypto asset sleeve will be capped at 22.5%, according to the proposed fund’s prospectus.

Bitwise says the filing positions it for growth as stablecoins and tokenization become dominant crypto themes, fueled by regulatory clarity and rising adoption under the GENIUS Act.

“The adoption of generic listing standards — which could come as early as October — will likely usher in a ton of new crypto ETPs,” said Bitwise chief investment officer Matt Hougan in a Sept. 15 report. 

Strongest Narratives In Crypto

The Bitwise ETF seeks to capitalize on two of the strongest narratives in crypto.

Stablecoins have boomed this year, with the catalyst for this rise being the GENIUS Act that was signed into law by US President Donald Trump. It provides a clear regulatory framework for both domestic and foreign stablecoin firms looking to issue their tokens in the US.

Between January and August, the market cap for the stablecoin sector surged 23% to $268 million, according to DefiLlama.

Stablecoin market cap (Source: DefiLlama)

Along with stablecoins, tokenization, which involves creating tokenized versions of assets such as real estate or traditional financial instruments like bonds or credit on the blockchain, has also been one of the strongest narratives in the market this year. 

The total value of tokenized real-world assets (RWAs) recently surged to around $76 billion, after also benefiting from the pro-crypto policies introduced by the Trump Administration in recent months.

Adding to the sector’s momentum, SEC Chair Paul Atkins said in July that the agency now views tokenization as an innovation that needs to be supported.

SEC Streamlines Crypto ETP Approvals

The regulator has also started streamlining the approval process for crypto ETPs, a development Bitwise says may trigger a tsunami of new offerings.

Currently, the SEC reviews spot crypto ETFs on a case-by case basis. Issuers are also required to file detailed proposals, which must show the regulator that the asset being tracked by the fund has enough liquidity and that it is also resistant to manipulation.

That review process can take up to 240 days, and does not guarantee that applications will be approved. 

Hougan believes that under a new process that the SEC is working on, applications would be “virtually guaranteed” if they meet precise requirements. This new process will also be a lot quicker, and could see applications approved in 75 days, he said.

Crypto ETPs Will Still Need Demand To Succeed

But Hougan warned that the potential surge in crypto ETP offerings might not necessarily lead to increased demand for digital assets. 

“The mere existence of a crypto ETP does not guarantee significant inflows,” he said, adding that there will also need to be a “fundamental interest in the underlying asset.” 

Hougan predicted that products tied to some cryptos, like Bitcoin Cash for example, “will have a hard time attracting flows unless the asset itself finds new life.” 

Regardless, the Bitwise executive still believes that the investment products will be perfectly positioned to rally when “fundamentals start to turn.”