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Analyst: It is possible that there will be a large number of liquidations related to cryptocurrency

2026-10-14 23:55:34
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Bloomberg analyst James Seyffart said that many cryptocurrency ETP applications awaiting approval from the U.S. Securities and Exchange Commission will be launched in 2026. However, many of these products may not survive beyond 2027.

An analyst noted that there could be over 100 cryptocurrency exchange-traded products available by 2026. But due to lack of demand, many of these products will soon cease to exist.

Bloomberg analyst James Seyffart stated on Wednesday that he agrees with the prediction made by crypto asset management company Bitwise, which suggests that more than 100 crypto ETFs will be launched by 2026. However, he also mentioned that many of these ETFs won’t last long.

“We will see a large number of crypto ETP products being liquidated. This could happen by the end of 2026, but more likely before the end of 2027,” said Seyffart. He added that currently, there are over 126 ETP applications waiting for approval from the U.S. Securities and Exchange Commission.

“Issuers are launching numerous new products.”

According to a report by The Daily Upside last month, 622 ETFs were closed last year, including more than 189 U.S.-based ETFs. A report released by Morningstar in January 2024 showed that the average duration of 244 ETFs that were closed in the U.S. in 2023 was 5.4 years.

Source: James Seyffart

Most of these investment products were closed because they failed to attract sufficient capital inflows, resulting in relatively small managed asset sizes.

Several cryptocurrency ETPs have been liquidated this year. Among them, the most notable are the ARK 21Shares Active Bitcoin Ethereum Strategy ETF and the ARK 21Shares Active On-Chain Bitcoin Strategy ETF.

The listing standards set by the U.S. Securities and Exchange Commission will facilitate large-scale approvals.

Industry analysts expect that the number of approved cryptocurrency ETPs in 2026 will increase significantly, as the new listing standards no longer require individual assessments for each application.

Even before the SEC’s new general listing standards took effect in September, asset management companies began submitting applications to launch ETPs tied to speculative tokens, such as Melania Trump’s memecoin.

ETFs tracking Litecoin, Solana, and Ripple were relatively successfully launched this year, with plans to expand to Bitcoin and Ethereum ETFs in 2024.

According to Farside Investors, since the launch of U.S. spot Bitcoin ETFs in January 2024, $57.6 billion has flowed into these ETFs. Since the launch of spot Ethereum ETFs in July 2024, $12.6 billion has flowed in.

Meanwhile, since late October, institutions such as Bitwise, VanEck, Fidelity, 21Shares, Franklin Templeton, and Grayscale have raised $725 million for Solana spot ETFs.

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