Grayscale, a16z, and CCI Demand SEC Reconsider Broad ETF Rules Now

Grayscale, a16z, and the Crypto Council for Innovation want the SEC to back off. All three filed letters on August 31, the final day of a 60-day public comment window, pushing back hard against any broad new restrictions on novel exchange-traded products.

The core ask is pretty simple: stop lumping everything together. The three organizations want the SEC to keep its existing classification rules in place for new exchange-traded products and judge each one on its own risk profile rather than sweeping them all into a single regulatory bucket. The comment period itself was opened by the SEC on June 30, when the agency put out a call for input on whether current regulations are actually up to the job of covering the next wave of ETFs — and whether the registration process needs a rethink. Industry players clearly had a lot to say.

What Each Firm Actually Wants

A16z’s position is probably the most detailed. The venture capital firm wants the SEC to evaluate novel products based on their specific characteristics — not category, not label, not asset class. They’re also pushing for synchronized reviews of fund registration and exchange listing processes, which right now can drag on separately and create delays that don’t serve anyone. And they want clearer, more predictable timelines. Basically, a16z thinks the current system is too slow and too vague, and they’ve laid out a fairly structured path to fix it.

Grayscale and CCI are largely aligned with a16z on the big stuff. Both support an optional confidential pre-filing process — a way for issuers to get early feedback from the SEC without triggering a public clock. That kind of back-channel dialogue could cut down on wasted time and surprise rejections. Grayscale’s argument goes further, though: products with an established compliance record shouldn’t face new regulatory hurdles just because they’re tagged as “novel.” If a digital asset product has already proven it can meet disclosure and listing requirements, Grayscale thinks it shouldn’t get treated like a first-time experiment.

CCI’s angle is a bit different. The group is focused on keeping regulatory efficiencies intact across both ETFs and non-ETF exchange-traded products, while making sure existing investor protections don’t get watered down in the process. They’d rather see better registration-status disclosures than a full overhaul of the approval system. Less dramatic, maybe, but probably more realistic.

All three are united on one specific point: they oppose automatic inclusion of products holding non-securities into the Investment Company Act framework. That’s a hard line. Pulling crypto ETPs into that framework by default would change how they’re classified, how they’re regulated, and how quickly they can get to market. None of the three want that.

Where They Actually Disagree

It’s worth noting that these three don’t agree on everything — not even close. The sharpest split is over the ETF label itself.

See also: Zcash Soars 82% on Grayscales $304M ETF as Monero Reaches $10B Market Cap

A16z thinks the term “ETF” should be reserved exclusively for funds registered under the Investment Company Act of 1940. Clean, simple, legally precise. Grayscale disagrees. Their view is that the label should reflect economic characteristics — what the product actually does — regardless of its legal structure. So a crypto product that behaves like an ETF should probably be called one, even if it’s not technically housed under the 1940 Act.

That’s not a small disagreement. It touches on how investors understand what they’re buying, how regulators categorize risk, and how the whole approval pipeline gets designed. CCI, for its part, doesn’t want to blow up the current system to resolve it. They’d rather improve disclosures around registration status so investors know exactly what they’re holding, without forcing a definitional war over three letters.

The SEC, for now, hasn’t said anything. No indication of which direction it’s leaning, whether it’ll adopt any of these recommendations, or when it plans to move. That silence is probably frustrating for the firms that spent time drafting detailed comment letters.

Why the Timing Matters

Stablecoin and crypto ETP adoption has grown sharply across major markets in recent years, and the pressure on regulators to keep pace is real. The SEC’s consultation was partly an acknowledgment that existing rules weren’t written with this kind of product in mind. A16z made that point directly: the infrastructure for crypto-based exchange-traded products has matured. Listing standards exist. Disclosure requirements exist. The argument is that the market has done a lot of the work, and the regulatory framework just hasn’t caught up.

More context: Urgent ASIC Crypto License Rush Surges to 45 Applications Before Deadline

If the SEC moves toward stricter classifications or forces crypto ETPs under frameworks designed for traditional securities, it could slow down product launches significantly. That’s the fear driving all three letters. And it’s not a hypothetical — regulatory uncertainty has already delayed multiple product rollouts in the past few years.

Whether the SEC takes a narrow or broad approach will likely shape how the next generation of crypto investment products gets built and brought to market. The agency received letters from Grayscale, a16z, and CCI dated August 31.