Although it follows years of industry efforts and regulatory debate, the SEC’s recent move to permit spot Bitcoin exchange-traded products (ETPs) under generic listing standards represents a significant shift in U.S. market access, enabling investors to gain exposure to Bitcoin through traditional brokerage accounts rather than via custodial wallets or unregulated platforms. The decision, announced on September 17, 2025, permits commodity-based trust shares that track spot Bitcoin to list on national securities exchanges, reflecting the agency’s finding that the proposals are consistent with the Securities Exchange Act of 1934 and related rules. The approval concludes a decade-long effort by industry participants to secure such clearance, and it marks the first time that spot Bitcoin products may trade on regulated U.S. exchanges. Observers note that access through brokerage accounts may broaden investor participation while shifting custody and surveillance responsibilities onto regulated intermediaries. The SEC also recently approved in-kind creations for crypto ETPs, reducing costs and improving operational efficiency. This approval comes amid ongoing regulatory ambiguity that continues to challenge innovation within the industry.
The approval follows complementary policy developments intended to modernize the regulatory framework for digital assets, including the launch of Project Crypto in July 2025, a program announced by SEC Chair Paul Atkins aimed at adapting securities laws to better accommodate crypto custody and trading. Project Crypto centers on exploring exemptions and rule modifications to address cryptoasset custody, and it reflects recommendations from the President’s Working Group on Digital Asset Markets, with staff work focused on creating clearer paths for broker-dealers to custody digital assets. These efforts are supported by a broader Regulatory Flexibility Agenda released in spring 2025, which lists proposed rules, safe harbors, and updated guidance for transfer agents and FINRA, signaling a shift toward regulatory flexibility for digital asset market structures.
Interagency coordination has also advanced, as evidenced by a joint SEC-CFTC statement on September 2, 2025, clarifying that registered exchanges may list and facilitate spot crypto trading under existing law, and endorsing a range of trading arrangements including leveraged or margin products. The SEC’s internal Crypto Task Force, led by Commissioner Hester Peirce, continues to examine classification, jurisdictional boundaries, registration requirements, and potential exemptive relief for DLT-based issuance, while accounting guidance such as SAB 122 has aligned crypto custody treatment with traditional safekeeping practices. Together, these steps increase clarity and market access, though risks related to market integrity, custody practices, and investor protection remain and warrant ongoing regulatory attention. A related development also reflects Congressional action on stablecoins through the passage of the GENIUS Act, which establishes a federal framework for stablecoin regulation.
