The Crypto Council for Innovation submitted comments to the Securities and Exchange Commission on Aug. 31 requesting streamlined approval pathways for non-ETF exchange-traded products, citing structural disadvantages relative to traditional ETFs.
CCI's core request centers on extending SEC Rule 6c-11—which allows qualifying ETFs to operate without individual exemptive orders—to non-ETF ETP structures. The group also pointed to Rule 485, which permits ETF sponsors to register new funds via post-effective amendments with defined automatic effectiveness periods. Extending these mechanisms would reduce approval timelines and lower compliance costs for novel products.
A secondary thrust targets tax treatment. CCI recommended that the SEC coordinate with the Treasury Department and Internal Revenue Service to address existing tax asymmetries between ETF and non-ETF structures. The group cited instances where certain non-ETF ETP structures face less favorable tax treatment, creating competitive distortions that influence product design decisions.
SEC Chair Paul Atkins initiated a review of novel ETFs in a May 20, 2026 statement, saying that "novel products raise novel questions." That examination provides the regulatory opening CCI and peer groups are exploiting to push for tailored rules rather than blanket restrictions.
CCI opposed amending the Investment Company Act's definition of an investment company, arguing the existing framework already grants regulators sufficient flexibility to assess whether a novel ETP qualifies. Revising the statute, the group contended, would introduce legal uncertainty and slow product launches.
On disclosure, CCI advocated for clearer ETP naming standards and product labeling rules. The group flagged naming confusion: certain exchange-traded commodity trusts and digital-asset products carry the ETF label despite operating under different securities law structures, potentially misleading retail investors.
A third priority concerns intellectual property protection. CCI proposed allowing issuers to submit confidential draft registration statements and participate in voluntary pre-filing consultations with the SEC. Critically, CCI stipulated that confidentiality protections should not extend or pause Rule 485 timelines, ensuring that IP safeguards do not delay market access.
While CCI, Grayscale, and Andreessen Horowitz aligned on broad principles, other commenters filed divergent positions. Points of disagreement included regulation of event contracts, the scope of confidential filings, product staking rules, and specific retail investor safeguards.
The industry push reflects a coordinated effort to shift the SEC's posture from static rule enforcement to predictable, efficiency-driven pathways for crypto asset products. The underlying argument: regulatory parity with traditional ETFs would reduce time-to-market and capital barriers for issuers without compromising investor protection.
