Grayscale has submitted a heavy application for a Polkadot and Cardano Spot ETF! The approval probability for altcoin ETFs has soared, with 92 applications igniting new opportunities in the crypto market.

The world's largest digital asset management company Grayscale Investments has officially submitted S-1 registration documents for Polkadot and Cardano spot ETFs to the U.S. SEC. This submission brings the total number of pending cryptocurrency ETF applications to 92, with the SOL ETF having a 99% approval chance. The documents indicate that both trusts utilize a cash creation/redemption mechanism and retain the staking yield function, but also warn of the regulatory risk of ADA being classified as a security.

ETF application details and trading arrangements

According to the submitted documents, the Grayscale Cardano Trust ETF will be traded on the NYSE Arca platform under the code GADA, while the specific trading venue for the Polkadot ETF is still awaiting final approval. Both trusts were registered in Delaware on August 12, 2025, continuing Grayscale's consistent pattern of completing legal entity registration prior to submitting SEC applications.

The approval probability of Shanzhai coin ETF has risen significantly.

The prediction market Polymarket shows that the likelihood of the approval of altcoin ETFs continues to rise: the probability of Solana ETF being approved before 2025 has reached as high as 99% (a significant increase from 72% in May), the probability of XRP ETF is 87% (64% in August), and even the meme coin Dogecoin has reached a probability of 82% (only 44% in June). Grayscale has also submitted an application for the Dogecoin ETF, coded GDOG, competing with Rex-Osprey and Bitwise.

Product Structure Design and Risk Disclosure

Both application documents clearly acknowledge the significant regulatory risks, particularly pointing out that the SEC previously determined that ADA constitutes a security. The documents warn that if ADA is ultimately designated as a security, it may lead to the termination of the trust's operations. The product adopts a pure cash creation/redemption mechanism, processed in units of 10,000 shares through authorized participants, and currently does not support physical subscriptions (pending "physical regulatory approval").

The valuation will be based on the CoinDesk Price Index (priced daily at 4 PM New York time), with custody services provided by Coinbase Custody Trust Company, and BNY Mellon acting as the transfer agent and administrator. The fee structure uses an underlying token payment model (non-cash).

stake function and liquidity arrangement

Both trusts retain staking functionality, but must meet unspecified "staking conditions". The Polkadot trust plan arranges for the staking of up to 85% of assets through vendors, but sets a 28-day unbinding period, which may impose liquidity constraints. This design provides investors with opportunities for yield enhancement while retaining flexibility to respond to regulatory changes.

Institutional demand drives application wave

Currently, there are 92 pending cryptocurrency ETF applications, an increase of 28% from 72 in April, which includes 8 Solana proposals and 7 XRP applications. October will be a critical time for approvals, as most SOL, XRP, and Litecoin proposals will face decision deadlines.

Bloomberg Intelligence analyst Eric Balchunas predicts: "The number of Crypto Assets ETF applications will soon surpass that of stock ETFs." The regulatory environment is also continuously improving: the SEC's approval of the physical redemption mechanism for Bitcoin and Ethereum ETFs has paved the way for compliance, and the SEC's collaboration with the CFTC on "encryption projects" is also advancing the clarification of asset classification.

Industry Leaders and Market Outlook

Nate Geraci, the president of The ETF Store, believes that these simultaneous submissions are "very noteworthy" and are a "good sign for approval prospects." Although BlackRock has launched pioneering Bitcoin and Ethereum ETFs, there are currently no confirmed plans for an XRP product.

NoOne CEO Ray Youssef predicts that major altcoins such as SOL, XRP, and BNB will attract massive capital inflows. In particular, Solana is preparing to accumulate hundreds of billions of dollars from multiple treasury companies for SOL. 21 Shares and Grayscale are leading in the Ethereum staking ETF applications, while VanEck's JitoSOL proposal has become the first fully liquid staking token-backed fund product.

Conclusion

Grayscale's dual ETF application marks a new phase in the competition for cryptocurrency ETFs, expanding from mainstream assets to diversified altcoins. Although regulatory risks still exist (particularly concerning securities designation), market expectations continue to heat up. Investors should pay attention to the key approval dates in October, while also recognizing the balance between staking yields and liquidity constraints. The process of ETF-ification of Crypto Assets is reshaping the allocation of institutional funds, bringing a new liquidity paradigm to the digital asset market.