SEC opens ETF rule review following crypto fund surge, prediction markets push

The Securities and Exchange Commission is taking a fresh look at how cryptocurrency exchange-traded funds and a proposed new class of funds tied to prediction markets should be regulated following a wave of crypto ETF approvals.

On Tuesday, the SEC said it is seeking public comment on the regulation of "novel ETFs" and how its current process for registering those funds may need to be changed.

“The Commission’s request for comment seeks input from the public on how the U.S. ETF market can continue to grow and innovate while serving investors effectively, and I look forward to reviewing feedback from market participants as we evaluate how to best respond to recent market changes," SEC Chair Paul Atkins said in a statement.

Since Atkins took the helm at the SEC in April 2025, the agency has greenlit dozens of crypto ETFs beyond ones tracking bitcoin and ethereum, which were approved under former SEC Chair Gary Gensler. Now, crypto ETFs tracking assets from SOL to DOGE are live.

Attention has turned to prediction market ETFs tied to political and economic outcomes. The SEC has not yet approved those funds and has delayed several proposals. Last month, Atkins said the agency plans to consider them in a "transparent and thoughtful manner." 

In its request for comment on Tuesday, the agency asked about a standardized framework for listing ETFs if it meets certain criteria should apply to the novel funds and whether they may need to register as an investment company. 

Comments are due in 60 days.