Bitwise Predicts 2026 Crypto “ETF Palooza,” but Some Products May Fail, Warns Seyffart

Digital asset manager Bitwise expects 2026 to usher in a surge of crypto ETP launches, citing streamlined SEC rules as a key driver. However, Bloomberg’s James Seyffart cautioned that many of these new products could fail within 18 months.

The forecast follows a regulatory shift in September, when the SEC approved rules allowing exchanges to list ETPs holding spot commodities, including cryptocurrencies, without requiring individual SEC reviews. This eliminates the lengthy 19(b) rule filing process, which previously could take up to 240 days.

“A clearer regulatory roadmap in 2026 is why we see the stage being set for an ‘ETF palooza,’” Bitwise wrote on X, tagging Seyffart. He responded, warning that the rapidly expanding market is likely to face a wave of closures.

“I’m in 100% agreement,” Seyffart said. “We’re going to see a lot of liquidations in crypto ETP products. This might start toward the end of 2026 but is likely to continue through 2027. Issuers are putting a LOT of products out there — there are at least 126 filings.”

Seyffart noted that while some consolidation may begin in late 2026, the majority of liquidations are expected throughout 2027 as competition intensifies and weaker products fail to attract investor flows.