The Teucrium XRP ETF became active not because the Securities and Exchange Commission approved it, but because the agency let the clock run out during a shutdown. This happened as the SEC announced that:- “Effective October 1 and until further notice, the agency will have a very limited number of staff members available. The SEC has staff available to respond to emergency situations with a focus on the market integrity and investor protection components of our mission.” That notice meant that ETF filings would move forward or stall depending on the law, not on active review. Crypto strategist Chad Steingraber captured the point clearly when he posted :- “The Teucrium XRP ETF was not approved by the SEC directly. They reached the deadline and the SEC didn’t ‘approve or deny’ the listing. So it was automatically allowed. ‘Silence is compliance.’” SEC leaves futures-style ETFs running while shutdown freezes spot crypto funds Financial journalist Eleanor Terrett explained why this happened. Teucrium’s product holds Treasuries, cash, and swap receivables and was filed under the 40 Act, which means the SEC didn’t need to approve it actively. Eleanor added that the Commission typically lets futures-style ETFs go effective after the statutory waiting period passes. By contrast, spot crypto ETFs are filed under the 33 Act as commodity trusts and need explicit approval before trading, which will not happen until the shutdown ends and the agency returns to full capacity. That breakdown shows the dividing line. Futures-style ETFs can run on autopilot after the statutory time limit, but spot products like XRP under the 33 Act can’t trade until SEC staff review and declare the registration effective. Because the agency is on limited operations, those S‑1s are not being processed. Meanwhile, the SEC’s own notice said all non-excepted employees are subject to furlough, official travel is canceled or postponed, training during the appropriations lapse must be canceled or postponed, and paid leave is voided. Any employee excepted must report for duty, but if they are sick their status would be furloughed. The agency emphasized that employees who have not been designated as excepted may not volunteer to work without pay, saying that such voluntary services “are a violation of the Antideficiency Act and will not be permitted under any circumstances.” Crypto issuers file dozens of ETFs while SEC stays frozen Despite the freeze, filings keep piling up. More than 30 crypto ETF applications hit the SEC this week. REX-Osprey filed prospectuses for 21 crypto funds on October 3, and Defiance lodged six more the same day. Bloomberg’s James Seyffart posted about the filings on X, saying that REX-Osprey’s lineup covers single-asset strategies tied to AAVE, ADA, ATOM, and ENA, some with staking features. Defiance’s submissions included six leveraged funds. Three were long on Bitcoin, Ethereum, and Solana, and three offered short exposure. All six aim for 3x leverage. Seyffart commented that “3x isn’t really allowed by the new leveraged ETP rules,” saying the issuer appears to be “targeting” 3x through options to get around the standard 2x cap. This is all coming after the SEC approved generic listing standards for crypto-related exchange-traded products on September 17 across Cboe, Nasdaq, and NYSE Arca, as Cryptopolitan reported . Those rules were meant to speed up spot crypto listings by removing 19b‑4 approvals and moving the bottleneck to the S‑1 filings. Fellow Bloomberg ETF analyst Eric Balchunas wrote on September 29 that altcoin ETF approvals are “really 100% now,” because the old 19b‑4 “clock” is moot and S‑1s just need Corp Fin’s green light. But now, as Eric put it, “everything is on ice… it’s like a rain delay,” and issuers must wait until the agency reopens. Get $50 free to trade crypto when you sign up to Bybit now
