Chainlink ETF confirmed to launch? The truth behind the DTCC list exposure and the two hurdles revealed by the SEC.

When Chainlink briefly appeared on the DTCC reference list, the crypto assets industry immediately claimed “LINK ETF has been confirmed.” In reality, like XRP and Bitcoin, this was just a routine system update from the DTCC, preparing for a possible future ETF launch, long before the SEC's final approval. LINK has entered the settlement system but has not yet passed approval.

DTCC list does not equal SEC approval

(Source: DTCC)

The role of DTCC (Depository Trust & Clearing Corporation) begins where speculation usually stops. It is a post-trade clearinghouse, not a regulatory body, and its data reflects operational readiness rather than policy endorsement. Bitcoin, Ethereum, and even XRP have gone through similar rumor cycles. This distinction is crucial as it helps investors recognize the reality.

The difference between BTC and ETH is that their listings occurred after the formal filing work had already begun, which includes changes in exchange rules and registration statements, and these are the cornerstones of ETF approval. Without these two, the ETF codes on the DTCC website are just empty shells: an empty door without a house. Most crypto asset ETFs that appear on the DTCC list will ultimately go live within 6 months, but the premise of this timeline is that the foundational regulatory work has been completed.

The Bitcoin ETF went live on DTCC in October 2023 and will officially launch in January 2024; meanwhile, Canary Capital's XRP ETF appeared on the DTCC list this month and officially launched today. These cases show that the DTCC list is indeed a positive signal, but it is by no means a final confirmation. For Chainlink, appearing on the DTCC list means that market infrastructure is preparing for a possible launch, but the SEC's approval process is the decisive factor.

Detailed Explanation of SEC Dual Approval Mechanism

To successfully list a cryptocurrency ETF for trading, two main approvals must be obtained in a specific order. First, the exchange proposing to list the ETF must receive approval for the 19b-4 rule filing. This filing requests the SEC to allow it to modify the exchange rules in order to list the new product. This step has always been a stumbling block for cryptocurrency ETFs.

The SEC will evaluate whether there is a “substantial market” to detect and prevent manipulation, or if there are alternative regulatory mechanisms that can achieve the same goals. The crux of the Grayscale securities case lies in this standard, forcing the SEC to clarify the relevant guidelines. Ultimately, spot Bitcoin and Ethereum ETFs will be approved in 2024. The SEC's order indicates that the regulation aims to address address manipulation in markets such as the Chicago Mercantile Exchange (CME). For Ethereum, exchanges can use correlation analysis to demonstrate that the trends of futures prices and spot prices are consistent.

Once 19b-4 approval is obtained, ETF issuers must submit an S-1 registration statement detailing the fund's structure, custodian, pricing, risks, and fees. The SEC will review this document and may raise follow-up questions, as was the case with the Ethereum ETF. No trading may begin until the S-1 statement becomes effective.

In summary, exchanges must first obtain listing approval (Form 19b-4), after which issuers must obtain issuance approval (Form S-1). Only when both licenses are approved can the ETF be listed. In 2025, the SEC introduced a universal listing framework aimed at streamlining these two approval steps for digital asset ETFs that are highly similar to already approved products. While this has indeed shortened the approval time, exchanges still need to demonstrate the liquidity and price reliability of the underlying market. For tokens like Chainlink, meeting both of these approval requirements remains challenging.

How the Launch of XRP and SOL Affects the Chainlink Timeline

The XRP ETF from Canary Capital officially launched today, marking an important milestone following Bitcoin and Ethereum. The successful launch of XRP sets a new precedent for other altcoin ETFs, especially regarding the SEC regulatory framework. XRP has faced a securities lawsuit from the SEC, but the court ruling has paved the way for its ETF. This case demonstrates that even crypto assets that have faced regulatory controversies have the opportunity to obtain ETF approval, as long as they can prove market liquidity and price reliability.

The launch of the Solana ETF is also expected to accelerate. Several asset management companies have already submitted applications for the Solana ETF, and the market generally anticipates that SOL ETFs will be approved within 2025. This chain reaction of launching altcoin ETFs creates a more favorable environment for the Chainlink ETF. The SEC's general listing framework means that once an altcoin ETF is approved, the approval process for subsequent similar assets will be smoother.

For Chainlink, this environmental improvement is a double-edged sword. On one hand, the advancements of XRP and SOL have paved the way for LINK in terms of regulation; on the other hand, Chainlink needs to demonstrate that its market liquidity and price discovery mechanisms are as reliable as the approved assets. Chainlink does not have futures products on CME, which makes correlation analysis more difficult. The SEC may need to rely on other regulatory mechanisms, such as directly monitoring the spot market.

Unique Challenges Facing Chainlink ETF

Lack of CME Futures Products: Unable to prove price reliability using futures correlation analysis.

Pledge Complexity: If the ETF pledges LINK, the SEC requires additional risk disclosures.

High Integration of DeFi: The widespread use of LINK in DeFi may cause liquidity diversion issues.

The Convenience and Trade-offs of ETF for Investors

If the Chainlink ETF ultimately passes all these steps smoothly, it could change the way native users of Crypto Assets and ordinary investors access digital assets. For the average person, this means being able to purchase LINK in the same brokerage account where they hold Apple stocks or S&P 500 index funds. No need to set up a wallet, no need for a mnemonic phrase, and no need to learn complex DeFi protocols. Filing taxes is also simpler: just fill out the 1099 form, without the hassle of dealing with various complicated electronic forms like most self-custody users do every April.

However, convenience comes with trade-offs. ETF holders need to pay management fees, which typically range from 0.5% to 2%, and this can erode long-term returns. Additionally, there may be tracking differences, which refer to the small but persistent gap between the ETF price and the actual market value of the tokens it represents. In cases of lower trading volumes, early price discrepancies can be significant.

More importantly, there is the conceptual cost: ETF investors currently cannot use LINK in DeFi, nor can they stake it or participate in governance proposal voting. What they hold is exposure to LINK, rather than its utility. For investors who truly believe in the value of the Chainlink ecosystem, this limitation could be a significant loss. Financial advisors are likely to view altcoin ETFs as a niche asset class within a diversified portfolio, possibly allocating only a few percentage points of total assets.

How to Track Real Progress to Avoid Rumors

To distinguish between genuine ETF progress and rumors, investors should focus on the official process steps and actual regulatory documents rather than screenshots to indicate significant progress in ETF issuance. Obtaining 19b-4 approval on the SEC website or in the Federal Register means that the exchange can legally list the product. The S-1 document being effective on the EDGAR system means that the issuer can officially offer shares to the public.

The listing information from DTCC and NSCC indicates that if these two events occur simultaneously, the back office has been prepared, but prior to this, it was not ready. Any discussions by the SEC regarding monitoring or related analysis, such as those referenced in the Ethereum approval order, reveal the agency's line of thinking. With Bitcoin, Ethereum, Solana, and now XRP, the market now has a clear template; however, each new asset will face its own liquidity and integrity tests.

The DTCC stock code may spark heated discussions, but it is just one step in the ETF issuance process. The entire process will only be considered complete once the SEC officially approves the 19b-4 and S-1 applications. At that time, formal documents (rather than screenshots) will be used to provide proof, marking the true beginning of the ETF issuance timeline.