Traders speculate on increasing likelihood of Dogecoin ETF approval in 2025

The recent acknowledgment by the Securities and Exchange Commission of Grayscale’s Dogecoin ETF filing has sparked speculation about potential changes in regulators’ attitudes towards cryptocurrency. Matthew Hougan from Bitwise believes that a Dogecoin ETF could provide a safer investment option but advises caution when it comes to expecting approvals for other meme coins.

There is a growing sense of confidence in the market that a spot Dogecoin DOGE/USD ETF could receive regulatory approval, as indicated by data from Polymarket, showing a 74 percent chance of approval by the end of 2025. This represents a substantial increase since the start of Donald Trump’s presidency, suggesting a positive outlook among investors.

The interest in a Dogecoin ETF comes in the wake of the SEC’s decision to review Grayscale’s applications for spot Dogecoin and XRP XRP/USD ETFs. This signifies a departure from the agency’s previous reluctance to consider cryptocurrency ETFs beyond Bitcoin and Ethereum, potentially signaling a shift in regulatory attitudes towards the industry.

Experts like Bloomberg’s ETF analyst Eric Balchunas view the SEC’s acknowledgment as a positive development, indicating a greater openness to a wider range of crypto investment products. Fox Business journalist Eleanor Terrett also observes a more receptive approach from the SEC compared to previous instances, such as the withdrawal of Solana ETF applications in December due to regulatory challenges.

Despite the growing optimism surrounding crypto ETF approvals, regulatory obstacles still pose a significant challenge. Bloomberg’s James Seyffart suggests that ongoing legal disputes, like the SEC’s case against Ripple, could impact the approval process for an XRP ETF. While Dogecoin is not entangled in similar legal issues, general regulatory uncertainty continues to influence the landscape of crypto ETFs.

In a discussion at The Digital Assets Forum in London, Bitwise Chief Investment Officer Matthew Hougan emphasized the need for meme coin ETFs to operate in a highly liquid and globally distributed market with minimal internal influence. Dogecoin’s established history and active community make it a strong contender for ETF approval, according to Hougan. Despite lacking the intrinsic value of Bitcoin, Dogecoin is not merely a speculative asset, as Hougan points out.

Hougan cautions against assuming that approval for a Dogecoin ETF would pave the way for other meme coins like Shiba Inu to follow suit. He suggests that approval decisions are likely to be made on an individual basis rather than granting blanket approval for similar assets. As Polymarket closely monitors regulatory developments, traders are anticipating a gradual approval process for a Dogecoin ETF, with higher chances towards the year-end compared to mid-year.