21Shares Files Polkadot ETF Amid Growing Altcoin Demand

Asset management firm 21Shares filed an S-1 with the SEC for a Polkadot ETF. The company plans to list shares on the Cboe BZX Exchange. 

The proposed 21Shares Polkadot Trust will mirror its current Polkadot Trust.

Polkadot Joins the Altcoin ETF Race

 The 21Shares Polkadot ETF will track DOT prices using the CME CF Polkadot-Dollar Reference Rate. According to the filing, Coinbase Custody will hold the assets.

The fund will follow a passive investment strategy. It will avoid leverage, derivatives, and active trading. Notably, Polkadot’s price hasn’t reacted at all to this announcement. DOT remains down by 10% in January.

“The market will decide where value lies and if there’s value in launching such a product. If no one puts money into a Polkadot ETF – it will close. People are free to launch whatever ETFs are deemed to be allowed by the SEC,” wrote analyst James Seyffart.

This filing comes after Tuttle Capital Management proposed a 2x leveraged Polkadot ETF earlier this week as part of a package of 10 leveraged crypto ETFs. 

However, ETF analyst Eric Balchunas confirmed that Tuttle Capital withdrew its filing for all 2x leveraged ETFs. 

Since Gary Gensler left his position earlier this month, the SEC has received a wave of altcoin ETF applications. Earlier today, Grayscale launched a Dogecoin Trust. The trust offers investors exposure to DOGE with a 2.5% management fee amid rising demand. 

Within hours, Grayscale converted the trust filing into an ETF application. This was likely the first time a trust was turned into an ETF on the same day. 

“Man, the jockeying is intense. I’ve never heard of a trust launching and then looking to convert to ETF the same day. But they may now be in pole position in 19b-4 race. Also, we now up to four Doge ETF filings (including 2x). Gensler has only been gone for like two weeks,” wrote Eric Balchunas. 

Grayscale also submitted ETF applications for XRP, Litecoin, and Solana. The firm recently launched a Bitcoin Miners ETF. The fund offers exposure to Bitcoin-linked companies without investing directly in cryptocurrency. It appeals to traditional investors.

SEC Likely to Wait for Paul Atkins

Along with the Polkadot ETF filing, 21Shares has a pending XRP ETF application with the SEC. Approval of an XRP ETF appears likely, but the SEC may delay further altcoin ETFs under the temporary leadership. 

Currently, Mark Uyeda leads the SEC on an interim basis. Paul Atkins, President Trump’s nominee, is still waiting for the congressional process to become the permanent chair.

However, when the SEC approves another altcoin fund, Litecoin may be the first. The commission has acknowledged Canary Capital’s Litecoin ETF application. 

It also helps that Litecoin is already classified as a non-security because it’s a fork of Bitcoin.