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So, the United States government shuts down, and what happens? The mail slows down, national parks get gross, and a bunch of federal employees get an unpaid vacation they didn't ask for. But in the weird, wonderful, and utterly deranged world of crypto, it’s party time.
While Washington D.C. was busy playing its favorite game of fiscal chicken, the crypto industry found a backdoor into the stock market. A dusty, forgotten loophole in securities law that basically says, "If the teacher doesn't say 'no' in 20 days, you can do whatever you want."
And boy, are they doing it.
Four crypto ETFs just waltzed onto the market, not with a bang, but with the deafening silence of a regulator that’s out of office. This is the financial equivalent of your parents going out of town and you immediately inviting the entire school over. The SEC is asleep, and the kids are raiding the liquor cabinet.
The Bureaucracy Breaks, The Grift Goes On
Let's be clear about what’s happening here. Issuers are filing these S-1 registration forms with a little bit of legalese magic called a “no delaying amendment.” It’s a procedural dare. It’s like sending a certified letter to the SEC that says, “We’re launching this thing in 20 days unless you physically get out of your chair and stop us.” And right now, there’s nobody home to even receive the letter.
This is a clever legal strategy. No, 'clever' doesn't cover it—this is a brazen, high-stakes bet that our federal regulators are so completely paralyzed by political theater that they can’t perform their most basic functions. And the bet is paying off.
The success of those first four funds—from Canary, Bitwise, and Grayscale—was the signal flare. It proved the door was unlocked. Now, of course, everyone is rushing the entrance. It's a testament to the unshakeable logic of capitalism: if there’s a loophole, someone will drive a truck through it. And if that truck is full of highly volatile, poorly understood financial products, even better.
This ain't some grand plan for democratizing finance. Give me a break. This is a land grab, pure and simple, happening while the sheriffs are all on furlough. The whole thing reminds me of those stupid government shutdowns in the first place. Every few years, the politicians in their fancy suits decide to hold the country hostage over some budget line item, and the only real result is that it creates chaos for everyone else to either suffer through or, in this case, exploit. It’s all just one big, dysfunctional ecosystem.
Now Everyone Wants a Piece of the Pie
With the first wave of ETFs now trading, the copycats are here. Fidelity wants a spot Solana ETF. Canary is back for an XRP fund. The filings are piling up, each one a new prayer tossed into the void, hoping the SEC continues its Rip Van Winkle impersonation.
I saw this quote from James Seyffart at Bloomberg Intelligence, and you have to read between the lines of his careful analyst-speak. He says, “a bunch will likely launch next month but there are some that are simply unlikely to launch without the government reopening.” What he’s really saying is, "The guys who already did their homework and got some feedback from the SEC before the shutdown are probably golden. But the clowns who are just showing up to the party now with a half-baked S-1 for some obscure coin are probably screwed." The situation has analysts suggesting that for Crypto ETFs: November Could Be the New October for U.S. After Shutdown Delays SEC Decisions.
The XRP ETF is the one to watch. The SEC apparently hasn’t spent much time on that one. This is the real test. Will some lone, heroic regulator, working for free out of sheer patriotism, see the filing and hit the big red “STOP” button? Or is the entire agency truly dark? They're basically hoping the one intern left at the SEC is too busy ordering pizza to notice the multi-billion dollar financial products being greenlit by default...
Maybe I'm just an old man yelling at a cloud, but this feels less like progress and more like a jailbreak. What does it even say about our markets when the most effective path to innovation is for the government to simply cease to function? Are we supposed to be celebrating this? It feels like cheering because your building’s security guard fell asleep, allowing you to finally hang that ugly painting you bought. The outcome might be what you wanted but the process is a complete disaster.
So We're Just Doing This Now?
Look, I get it. The crypto world has been begging for a spot ETF for years, and the SEC, under Gary Gensler, has been dragging its feet with the enthusiasm of a teenager asked to clean their room. I don’t blame these companies for trying. But let's not pretend this is a victory for the little guy or a triumph of innovation. This is a symptom of a deeply broken system. We’re launching complex financial instruments not based on their merit or safety, but on whether a government agency is too gridlocked to do its job. It’s absurd. Welcome to the future of American finance, where the only rule is that there are no rules as long as nobody’s looking.
