US SEC Opens Proceedings on Grayscale Polkadot Trust (DOT) ETF Listing Under Nasdaq Rule 5711(d)
On 10 June 2025, the United States Securities and Exchange Commission (US SEC) issued an order instituting proceedings to assess whether to approve or disapprove Nasdaq’s proposed rule change for listing the Grayscale Polkadot Trust (DOT) under Rule 5711(d), which governs commodity-based trust shares. The proceedings have been initiated under Section 19(b)(2)(B) of Securities Exchange Act of 1934 and are filed under docket number SR-NASDAQ-2025-019.
- The proposal was originally submitted by Nasdaq on 24 February 2025 under Section 19(b)(1) and Rule 19b-4.
- It was published for public comment in the Federal Register on 13 March 2025.
- The US SEC extended the review period on 24 April 2025 and has now formally opened proceedings for further evaluation.
- The Grayscale Polkadot Trust proposal aims to track the value of DOT tokens held by the Trust, minus any applicable expenses and liabilities.
- Net asset value (NAV) will be determined using the CoinDesk DOT CCIXber Reference Rate, which aggregates DOT trading data from multiple platforms.
- The Trust will hold only DOT tokens and will allow share creation and redemption in blocks of 10,000, exclusively in cash.
- Grayscale Investment Sponsors, LLC is the sponsor as of 3 May 2025.
- CSC Delaware Trust Company will act as trustee, and Coinbase Custody Trust Company, LLC will serve as custodian.
- The proceedings are intended to evaluate whether the listing satisfies the requirements under Section 6(b)(5) of the United States Securities Exchange Act.
- Section 6(b)(5) requires that exchange rules be designed to prevent fraud, ensure fair and orderly markets, and protect investors.
- The US SEC has invited comments on whether listing a DOT-based trust introduces novel regulatory concerns.
- Specific focus areas for comment include market manipulation risks and adequacy of market surveillance.
- Public comments are requested to be referenced to file number SR-NASDAQ-2025-019 and may be submitted electronically or by mail within the prescribed time period.
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US SEC Institutes Proceedings to Consider Approval or Disapproval of Canary HBAR ETF Listing on Nasdaq Under Rule 5711(d)
On 10 June 2025, the United States Securities and Exchange Commission (US SEC) published an order instituting proceedings to evaluate whether to approve or disapprove Nasdaq’s proposed rule change, as amended, for the listing and trading of the Canary HBAR ETF. The ETF would be listed under Nasdaq Rule 5711(d), which governs commodity-based trust shares. The order initiates a deeper review process under Section 19(b)(2)(B) of the United States Securities Exchange Act of 1934 and does not imply any preliminary conclusion on the proposal’s merits.
- The proposal was originally filed by The Nasdaq Stock Market LLC on 21 February 2025 under Section 19(b)(1) and Rule 19b-4.
- Amendment No. 1, which replaced the original filing in full, was submitted on 4 March 2025.
- The amended proposal was published in the Federal Register on 13 March 2025.
- The US SEC extended its initial review period on 24 April 2025.
- The ETF seeks to provide investors with direct exposure to Hedera (HBAR), less applicable trust expenses and liabilities.
- Net asset value (NAV) will be based on the CoinDesk Hedera USD CCIX 30min NY Rate, calculated using aggregated executed trade data from major exchanges.
- Shares may be created and redeemed in blocks of 10,000 units, either in cash or in-kind.
- Canary Capital Group LLC will serve as sponsor, while CSC Delaware Trust Company will act as trustee.
- Digital asset custody will be handled jointly by BitGo Trust Company, Inc. and Coinbase Custody Trust Company, LLC.
- The SEC proceedings aim to determine whether the proposal aligns with Section 6(b)(5) of the Exchange Act.
- Section 6(b)(5) requires exchange rules to prevent fraud, ensure market fairness, and protect investor interests.
- Public comments are invited to address whether the ETF satisfies statutory criteria for listing.
- The US SEC also seeks feedback on whether the selected CoinDesk benchmark sufficiently addresses price accuracy and resistance to manipulation.
- Comments must reference file number SR-NASDAQ-2025-018 and be submitted within the designated window, with rebuttal comments allowed up to 35 days after publication in the Federal Register.
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US SEC Opens Proceedings on Bitwise Bitcoin and Ethereum ETF Listing Proposal Under NYSE Arca Rule 8.201-E
On 10 June 2025, the United States Securities and Exchange Commission (US SEC) published an order instituting proceedings, to evaluate a proposed rule change submitted by NYSE Arca, Inc. The proposed change aims to permit the listing and trading of shares of the Bitwise Bitcoin and Ethereum ETF under NYSE Arca Rule 8.201-E, which governs commodity-based trust shares. This procedural step does not indicate any final stance by the Commission but opens the door for detailed scrutiny under US securities law to assess the compliance of the dual-asset crypto ETF with statutory requirements.
- The US SEC issued an order on 10 June 2025 to initiate proceedings under Section 19(b)(2)(B) of the United States Securities Exchange Act of 1934.
- The proposed rule change was filed by NYSE Arca, Inc. on 19 February 2025 pursuant to Section 19(b)(1) and Rule 19b-4.
- The ETF proposes to hold both bitcoin and ether, making it a dual-asset crypto trust.
- The proposal was first published in the Federal Register on 12 March 2025.
- On 24 April 2025, the US SEC extended its initial decision deadline to 10 June 2025.
- NYSE Arca Rule 8.201-E governs the listing and trading of commodity-based trust shares.
- The US SEC has not made a determination on the proposal’s merits.
- The proceeding allows further analysis of the rule change’s consistency with Section 6(b)(5) of the Exchange Act.
- Section 6(b)(5) mandates that exchange rules prevent fraud and manipulation, ensure just and equitable trading, and protect investors and the public.
- The US SEC specifically seeks public comment on whether the ETF’s dual-asset structure introduces unique risks not present in single-asset products.
- Commenters are encouraged to address whether the justifications provided by NYSE Arca sufficiently support the proposed change.
- Submissions must be made in reference to the proposal as published in the Federal Register.
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US SEC Director of Investment Management Natasha Vij Greiner to Step Down on 4 July 2025 After 23 Years of Public Service
On 10 June 2025, the United States Securities and Exchange Commission (US SEC) publishes a statement stating that Natasha Vij Greiner, Director of the Division of Investment Management, will conclude her tenure on 4 July 2025, marking the end of a 23-year career in federal securities oversight. The statement highlighted her distinguished service across four major SEC divisions and her notable leadership during a transformative period in the investment management sector.
- Natasha Vij Greiner was appointed as Director of the Division of Investment Management in March 2024.
- Over her SEC career, she held senior positions in the Divisions of Investment Management, Enforcement, Examinations, and Trading and Markets.
- She began her service as a broker-dealer examiner in the Office of Compliance Inspections and Examinations (OCIE).
- Greiner is a two-time recipient of the Chairman’s Award for Excellence (2015, 2018).
- She also received the Chairman’s Award for Serving the Interests of Main Street Investors in 2019.
- US SEC Chairman Paul S. Atkins praised her strategic leadership, judgment, and enduring contribution to investor protection and market integrity.
- Greiner expressed deep gratitude for the opportunity to serve the public, attributing her experience to the integrity and dedication of SEC staff.
- Her retirement comes amid major regulatory shifts in the investment management space, during which she played a key leadership role.
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US SEC Seeks Public Input on Revising the Definition of Foreign Private Issuer Amid Market Evolution
On 4 June 2025, the United States Securities and Exchange Commission (US SEC) released a concept release inviting public feedback on whether to revise the long-standing definition of a “foreign private issuer” (FPI) under US securities law. This initiative signals the US SEC’s intent to re-evaluate regulatory accommodations for foreign companies listed in US capital markets, in light of globalisation trends, evolving corporate structures, and market transformations since the last substantial review in 2003. The consultation aims to assess whether the existing FPI regime continues to serve its intended function or requires reform to ensure regulatory parity and investor protection.
- The concept release invites comment on whether the current definition of “foreign private issuer” remains appropriate in today’s globalised market.
- FPIs currently benefit from lighter-touch reporting, exemption from proxy rules, and permission to use IFRS without US GAAP reconciliation.
- The FPI test presently considers shareholder residency, governance location, and operational nexus as the basis for classification.
- US SEC Chairman Paul S. Atkins emphasised the need to balance investor protection and fair competition with the objective of attracting foreign listings.
- The Commission seeks input on whether the current test is effective, or prone to manipulation or regulatory arbitrage.
- Stakeholders are encouraged to comment on the economic, legal, and operational implications of modifying FPI eligibility.
- The concept release highlights that the purpose is to solicit policy views and empirical insights, not to propose specific rules at this stage.
- Particular focus is placed on whether cross-border corporate structures create uncertainty or competitive advantages under the current regime.
- Comments may address potential compliance burdens or market inefficiencies resulting from the current FPI definition.
- The public comment period will remain open for 90 days after publication in the Federal Register.
- Market participants, particularly FPIs and their advisors, are advised to reassess their corporate arrangements in anticipation of possible definitional changes.
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US CFTC Warns Victims of Traders Domain Fraud to Submit Claims by 28 July 2025 or Forfeit Eligibility
On 3 June 2025, the United States Commodity Futures Trading Commission (US CFTC) issued a press release through its Division of Enforcement, calling on all victims of the fraudulent scheme operated by Traders Domain FX Ltd. to submit formal claims by 28 July 2025. The Commission clarified that only timely, valid claims would be considered for restitution in any forthcoming court-ordered relief. Prior communications, surveys, or informal contact with the US CFTC do not qualify as formal claims and will not secure eligibility for compensation.
- The US CFTC issued a formal alert on 3 June 2025 via its Division of Enforcement.
- The alert applies to individuals affected by the Traders Domain FX Ltd. scheme.
- Victims must submit valid claims by 28 July 2025 to be eligible for restitution.
- Informal submissions, such as surveys or emails, will not qualify as valid claims.
- The US CFTC filed a civil enforcement action in the Southern District of Florida.
- The scheme allegedly ran from November 2019 to late 2023, involving over $280 million.
- Defendants include Traders Domain FX Ltd., Safranko, and Negus-Romvari.
- The alleged fraud involved false statements about retail commodity trading performance.
- Funds were pooled under the guise of sophisticated forex and commodity trading.
- Over 2,000 retail customers are estimated to have been defrauded.
- Judge Roy K. Altman issued a restraining order on 3 October 2024, freezing assets.
- A preliminary injunction hearing was held on 29 October 2024.
- Relief sought includes full restitution, disgorgement, civil penalties, and permanent bans.
- Legal action is based on violations of the Commodity Exchange Act and US CFTC regulations.
- The US CFTC continues to pursue enforcement with a view to securing maximum recovery for victims.
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