SEC Freezes Polkadot ETF Again—Is This the Final Standoff?

SEC Postpones Decision on Polkadot ETF Again, Sets New Deadline for November 2025

The U.S. Securities and Exchange Commission (SEC) has once again delayed its decision on the proposed 21Shares Polkadot (DOT) Spot Exchange-Traded Fund (ETF), extending the regulatory review period to November 8, 2025. This postponement continues a trend of caution by the financial watchdog as it evaluates multiple cryptocurrency-related investment products amid an evolving regulatory climate.

Originally scheduled for a verdict by June 24, the SEC's latest move reflects the agency’s ongoing concerns regarding market manipulation, investor protection, and the overall readiness of the crypto market for mainstream financial instruments. The ETF, if approved, would be listed on the Cboe BZX Exchange, with Coinbase designated as the custodian for the underlying Polkadot tokens.

A Pattern of Delay Across the Board

The delay follows similar actions by the SEC on other altcoin ETF proposals. Just last week, the commission postponed its decision on Grayscale’s separate Polkadot ETF application, initially filed on June 11, signaling a broader hesitancy toward greenlighting spot crypto ETFs beyond Bitcoin and Ethereum.

Source: CoinMarketCap

The SEC has consistently taken a case-by-case approach to ETF applications involving altcoins, including XRP, Solana (SOL), Litecoin (LTC), and Dogecoin (DOGE). According to a spokesperson for the agency, “extended time is needed to gather public comments and perform a more comprehensive analysis of the market structure, custody solutions, and potential for manipulation.”

While the regulator’s caution frustrates some in the digital asset space, analysts say it reflects the complexities of integrating decentralized assets into traditional investment frameworks.

DOT Price Surges Despite Delay

Despite the regulatory holdup, Polkadot's price responded positively. Within 24 hours of the announcement, DOT surged by approximately 7%, currently trading at $3.42 with a 0.86% increase. The token now holds a market capitalization of approximately $5.44 billion, according to CoinMarketCap.

Market analysts attribute this rally to a broader upswing in investor sentiment following reports of a ceasefire between Israel and Iran. Bitcoin’s surge past $106,000 further boosted confidence across the cryptocurrency market, contributing to the rally in altcoins like Polkadot.

The rise in DOT's price highlights investors’ long-term confidence in the Polkadot network, which emphasizes interoperability and scalability across blockchain ecosystems. Many view the SEC’s postponement not as a rejection, but as a procedural delay in what could ultimately become a significant milestone for institutional access to DOT.

Analyst Expectations Remain Optimistic

While the SEC continues to stall, prominent voices in the financial analysis community remain confident that approval is only a matter of time. Bloomberg’s Eric Balchunas and James Seyffart—both well-regarded ETF analysts—have voiced strong optimism regarding the future of crypto ETFs, including those based on altcoins.

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Seyffart recently estimated that there is a “90% or better” chance that crypto ETFs like the Polkadot spot product will receive SEC approval in the coming cycle, possibly as early as late 2025. He emphasized that the commission’s detailed engagement with issuers and exchanges suggests a proactive, albeit slow-moving, regulatory approach.

“Delays are frustrating, but not necessarily bad,” said Seyffart in a recent broadcast. “The SEC is clearly doing its due diligence, which is essential for long-term legitimacy in this space.”

21Shares and Its Push for Polkadot Recognition

21Shares, the Switzerland-based firm behind the ETF proposal, is no newcomer to the crypto investment landscape. In 2021, it launched the world’s first Polkadot Exchange-Traded Product (ETP) on the SIX Swiss Exchange, providing European investors exposure to DOT in a regulated environment. Now, the firm aims to replicate that success in the U.S. market with a spot ETF format.

The ETF application, filed on January 31, 2025, positions Coinbase as the custodian—underscoring the emphasis on institutional-grade security and compliance. If approved, the fund would allow U.S.-based investors to gain exposure to Polkadot without the need to directly manage digital wallets or private keys.

However, success is not guaranteed. If the ETF fails to garner sufficient demand or faces insurmountable regulatory hurdles, 21Shares may choose to withdraw or rework the product. Still, the potential upside remains compelling, especially in an era of growing institutional interest in crypto assets.

Regulatory Landscape and Market Integration

The SEC’s hesitance is not without merit. Spot crypto ETFs introduce a host of regulatory concerns that differ from those tied to futures-based products. Issues such as market manipulation, liquidity, and custodial risk remain high on the agency’s agenda.

Moreover, the collapse of several high-profile crypto firms in recent years has reinforced the need for tighter safeguards. The SEC has repeatedly emphasized the need for transparent pricing mechanisms, robust surveillance sharing agreements, and investor protections comparable to those in traditional securities markets.

That said, the SEC has approved Bitcoin spot ETFs earlier this year, and Ethereum ETFs are expected to go live by Q3 2025. This trajectory suggests that altcoins such as Polkadot may not be far behind, assuming issuers can meet the agency’s stringent standards.

Broader Implications for Crypto Adoption

Beyond the specifics of Polkadot, the ongoing ETF reviews hold broader implications for the cryptocurrency sector. Spot ETFs are seen as a key bridge between traditional finance and decentralized assets, opening the door for pension funds, asset managers, and retail investors to participate in crypto markets through familiar vehicles.

The approval of a DOT ETF would likely signal growing institutional comfort with more specialized blockchain ecosystems, especially those focused on solving cross-chain interoperability—a core strength of Polkadot’s protocol.

Furthermore, ETFs could help bring greater price stability and liquidity to the underlying assets, boosting confidence and participation across both retail and professional investor segments.

What to Expect Next

The SEC’s final decision on the 21Shares Polkadot ETF is now scheduled for November 8, 2025. Between now and then, the commission will continue to review public comments, assess market data, and potentially hold discussions with industry stakeholders.

In the meantime, market watchers will monitor price action, regulatory speeches, and related ETF rulings for signs of progress. While the timeline remains uncertain, the direction appears increasingly favorable for Polkadot and other crypto assets aiming for mainstream investment exposure.

If approved, the ETF could mark a pivotal moment in the ongoing convergence of crypto and traditional finance—a moment many believe is not a question of if, but when.

Writer @Ellena

Ellena is an experienced crypto writer who loves to explore the intersection of blockchain technology and financial markets. She regularly provides insights into the latest trends and innovations in the digital currency space.

 

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