How Will a US Government Shutdown Affect Crypto ETFs?

The shutdown of the US government has become a significant development creating uncertainty for cryptocurrency investors. The approval processes for ETF applications of cryptocurrencies like **Solana (SOL)** and **Litecoin (LTC)** may be affected by this situation. Congress's budget dispute has brought the long-awaited cryptocurrency ETF approvals to a critical juncture.

The US Securities and Exchange Commission (SEC) was planning to take important steps to decide on Solana and Litecoin ETF applications in October. However, the mandatory furlough of SEC employees due to the government shutdown has created significant uncertainty in this process. Although many asset management companies have updated their S-1 applications by staying in close contact with the SEC in recent months, the process has currently come to a standstill.

Significant progress had been made, especially in **spot Solana ETF** applications. Some market analysts predicted that approval could come "next week." However, it is observed that the government shutdown has weakened this possibility. The SEC's new procedure, however, continues to be promising for investors. Recently, the SEC had requested exchanges to withdraw their 19b-4 applications and resubmit them under the "Generic Listing Standards" framework; this step had raised hopes for progress towards approval.

The deadline for Canary Capital's Litecoin ETF application was **October 2**. Throughout October, there are critical dates between **October 10 and 24** for many other products as well. However, due to the government shutdown, these dates have become uncertain. Based on past experiences, during the 34-day shutdown in 2018, the SEC halted most applications not deemed "critical for market stability." A similar scenario is highly likely now.

Market analysts point out that if the SEC prepared the documents before the shutdown, approvals could still come during the shutdown period. However, this possibility is stated to be low. Currently, both issuers and cryptocurrency market players are focused on the political process in Washington. The key points for crypto investors to monitor are the uncertainty and its effects on ETF approval processes.