Gushiken Yona
The U.S. Securities and Exchange Commission’s approval of new generic listing standards has defined a direct path for a potential spot Shiba Inu ETF. The asset meets the key requirement as its futures contract has been trading on the CFTC-regulated Coinbase Derivatives exchange for over a year. As the path clears for a wave of new crypto ETFs, including one for SHIB, 3iQ’s Executive Vice President of Product, Greg Benhaim, warns of the significant market challenges that lie ahead.
Key Points
- Expert Warns of ETF Glut: Greg Benhaim of 3iQ cautions that the imminent launch of numerous crypto ETFs will create a hyper-competitive environment for capital and could confuse retail investors.
- SHIB Now ETF-Eligible: Shiba Inu meets the SEC’s key requirement for an ETF because its futures have been trading on the CFTC-regulated Coinbase Derivatives exchange since July 15, 2024.
- Challenge Shifts to Market Competition: With the regulatory path clear, the success of a potential SHIB ETF now hinges on its ability to compete for investor attention and capital in a crowded field.
Expert Cautions on Imminent ETF Wave
In response to new SEC guidelines for ETFs, Greg Benhaim, Executive Vice President of Product at 3iQ, offered a counter-narrative focused on practical market challenges. Drawing from his firm’s experience as an ETF issuer in Canada, he highlighted the potential downsides of this sudden market expansion in a note shared with The Shib Daily.
“At first glance, this seems bullish for the industry,” Benhaim shared. “However… it may be challenging for issuers to fight for raising capital when new products are being listed every single day.”
He also underscored the risk for retail participants who will soon face a barrage of new products. “To the average investor, they may have a tough time distinguishing between which coins to purchase,” Benhaim explained. “For example an AVAX ETF and an ADA ETF are very different but the investor may not appreciate this fully.”
How New SEC Rules Make a SHIB ETF Possible
Benhaim’s warning coincides with the removal of regulatory hurdles for a spot SHIB ETF. The SEC’s new generic listing standards allow exchanges to list crypto ETPs without a lengthy approval process, provided the asset has a futures contract that has traded for at least six months on a CFTC-regulated market.
Shiba Inu meets this critical requirement. According to a market notice from Coinbase Derivatives, futures for “1k Shib (SHB)” began trading on its platform on July 15, 2024.
Having traded for over 14 months, the SHIB futures contract exceeds the SEC’s six-month mandate, placing it in the same eligibility pool as assets like Solana and Polkadot. The new SEC rule makes a spot SHIB ETF a regulatory possibility.
Focus Shifts to Market Viability and Competition
The SEC’s decision alters the process for listing crypto investment products in the U.S. The primary challenge for issuers now involves proving an asset’s viability in a competitive market.
For the Shiba Inu community, which has long advocated for an ETF, the new rules signal the beginning of a more competitive phase. As Benhaim noted, the market itself will now act as the ultimate filter.
The proliferation of funds “will pave the way for the industry to identify which assets have significant retail appeal in ETF format and which don’t.”
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Yona has no crypto positions and does not hold any crypto assets. This article is provided for informational purposes only and should not be construed as financial advice. The Shib Daily is an official media and publication of the Shiba Inu cryptocurrency project. Readers are encouraged to conduct their own research and consult with a qualified financial adviser before making any investment decisions.
