🕴️ Persistently in EDGAR

Hello, hello! Bitcoin briefly broke $68,000, and we're back with a fresh update about crypto and policy.

• Any thoughts on the latest in the blockchain world? crypto@axios.com

Today's newsletter is 1,264 words, a 5-minute read.

Investment companies focused on crypto can't get enough of ETFs, but the SEC is another story.

Why it matters: Exchange-traded funds make digital assets more accessible, and can provide a security and compliance layer necessary for institutional investors.

The latest: Companies keep proposing new ETFs, for new cryptocurrencies and more complex options-based products, to the nation's securities regulator.

• Just this week, Grayscale proposed converting its Digital Large Cap Fund to an ETF and Canary Capital proposed a litecoin ETF.
• Bitwise filed for an XRP ETF earlier this month.

Zoom in: Grayscale's ETF would get an investor into bitcoin, ether, Solana's SOL and Avalanche's AVAX all in one instrument.

• Litecoin is an old cryptocurrency whose relevance has been slipping. It was the seventh-largest digital asset in the second week of October 2018, but it has slipped to the 21st spot.
• XRP is a digital asset that now sits at the seventh-most valuable spot.

Yes, but: Statements and actions from the chiefs of the SEC show an agency that couldn't be more ill-disposed toward the cryptocurrency industry.

• While investment firms look to amp crypto liquidity with regulated products, the SEC is suing liquidity providers.

Reality check: Existing bitcoin ETFs, the first products approved for digital assets, only happened because the SEC lost in court.

• The timing of the second and latest ETF approval, for ether, looked like a political maneuver, but there's no way to know that for sure.
• In announcing the bitcoin ETF approval in January, SEC chair Gary Gensler said, "It should in no way signal the Commission's willingness to approve listing standards for crypto asset securities. Nor does the approval signal anything about the Commission's views as to the status of other crypto assets under the federal securities laws."
• Between the lines: No other digital asset is likely to have the political muscle to get an ETF green light.

Zoom out: The success of crypto ETFs has been a mixed bag.

• Bitcoin's ETFs were a wild success, led by BlackRock's IBIT, which was the fastest-ever to hit $10 billion in assets under management. Collectively, the bitcoin ETFs are outperforming the first ETFs for gold.
• Yes, but: Ether ETFs were much more lackluster. Lightning did not strike twice.

What we're watching: The community that seems to think it has the best shot at the next spot ETF is fans of solana, which had a surge in 2021 and another this year. It's the fifth-largest crypto asset.

• Users have flocked to the Solana blockchain network this year to make bets on meme coins, though it also runs other interesting networks, such as for networking and cartography.
• Indeed, venture fund a16z credits Solana as the largest single contributor to the growth of on-chain activity this year, with 100 million active addresses (which doesn't mean 100 million people — but it probably does mean millions and millions of people).

💭 Our thought bubble: None of these will happen in the near term.

• That said, there's one thing the bitcoin ETF hopefuls proved: Persistence pays off.

The internet was much more curious about former President Trump's stances on and involvement in cryptocurrency than that of his rival for the White House, Vice President Kamala Harris, according to data from Similarweb, a digital intelligence platform.

Why it matters: Cryptocurrency became an issue in the top-of-the-ticket contest this year after Trump declared his support for the industry in May.

Zoom in: People are curious about a lot more things related to Trump than they are about Harris. Searchers ask about his involvement with digital assets, his family's, how to invest in his crypto project and what he thinks about the topic.

• For Harris, it's much less complicated. Searchers just seem to want to know about her policy approach.

Between the lines: Similarweb tells Axios that their data shows searches for Trump's name combined with "crypto" drove a great deal of traffic to his website.

• For Harris, the searches were more likely to take them to YouTube or other websites.

Yes, but: Interest in this topic tapered off through September, with curiosity dropping faster for Trump.

The crypto industry keeps checking with voters to see if their attitude about blockchains will show up in the ballot box.

Why it matters: This election is so, so close that anything that can nudge a voter to show up counts for something.

The latest: Today, the industry advocacy group Chamber of Digital Commerce released a poll with XandY Analytics of 1,004 adults, finding positive sentiment in both parties for candidates who want to update laws and regulations for the blockchain industry.

• 25% of Democrats and 21% of Republicans said that a candidate's stance on the industry could positively impact their decision to vote for them, according to the poll conducted Sept. 12–17.
• 16% of voters surveyed said they identified as part of the crypto voter bloc.

Separately, venture firm a16z has found search interest in crypto topics picking up in presidential election battlegrounds.

• In data across 2024 ending in September, it's seeing an increased search interest in the topic in the swing states, Pennsylvania, Wisconsin and Michigan.
• That said, Nevada and Arizona are losing interest, and Georgia's search is unchanged.

What we're watching: The real winner in 2024's marriage of crypto and politics this year has been prediction markets, led by Polymarket, which runs on a blockchain and uses stablecoins to fund its markets.

• But others have done well too, such as Kalshi, which has been winning its contest with U.S. regulators to run markets on elections (this year).
• Both those markets diverge from the polls just a bit, favoring Trump, while the polling-based models still favor Harris.

Yes, but: They are both still so close it barely matters which candidate is "ahead." If either says that one candidate has a 55% chance of winning, say, and the other wins, you can't really say that the model got it "wrong."

• A 45% chance of winning is still a pretty decent chance.

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😭 Sales of the Trump-affiliated World Liberty Financial's token are going very, very slowly. (The Defiant, Dune Analytics)

🔒 MoneyGram's CEO is weighing adding some bitcoin to the company's balance sheet. (Axios)

🫢 Sen. Elizabeth Warren says it's fine if people want to buy bitcoin, in a debate with her senate challenger. (Blockworks)

📉 Sentencing for FTX's Nishad Singh is coming up on Oct. 30, and Gary Wang on Nov. 20. (CoinDesk)

In the gold paper (rather than a white paper) for the Trump-affiliated World Liberty Financial, it makes clear that Trump and his family are not staff or employees:

• "None of Donald J. Trump, any of his family members or any director, officer, employee or principal of the Trump Organization ... is an officer, director, founder, or employee of, or manager, owner or operator of Word [sic] Liberty Financial or its affiliates or the WLF Platform."

However, it also notes, on the same page, that:

• "Under the terms of the services agreement, DT Marks DEFI LLC (i) agreed to use reasonable efforts to request the owners and principals of DT Marks DEFI LLC, including Donald Trump, to promote the WLF and the WLF Protocol from time to time ... For these services and rights, World Liberty Financial agrees that DT Marks DEFI LLC will receive 22.5 billion $WLFI tokens and a right to receive 75% of the net protocol revenues as defined in the services agreement after deduction of agreed operating expenses and the initial treasury reserve." [our emphasis added]

The latest: As of this morning, World Liberty Financial has only sold 4% of its token supply.

Reach CTOs, CIOs and tech leaders with Axios.

We'll help you tell your story in the right way:

• We'll distill your brand's message into its most effective form with Smart Brevity.
• No clutter, no filler — just clean, smart and effective.

Contact us to learn more.

This newsletter was edited by Pete Gannon and copy edited by Carolyn DiPaolo.

🗽 The ebbs and flows of this prediction market contrasting the election winner with the popular vote have me scratching my head this morning. (No one has any idea what's gonna happen, folks.) —Brady