SEC Chairman Gary Gensler is well-known for his anti-crypto stance. According to Gensler, all tokens are securities, which means they should be regulated by the SEC.

From a big-picture point of view, Gensler sees the whole industry as being filled with fraud, scams, and unregistered securities. Bitcoin is the only exception.

In this light, it is especially surprising that Gensler has recently softened his stance. In an interview with CNBC, Gensler discussed potential crypto ETFs. As usual, Gary was critical of the industry, highlighting the topic of crypto bankruptcies and arguing that more regulation was needed to protect investors. In short, we have heard these words many times.

However, he stated that meme coins like BONK can be considered valid investments if they provide adequate disclosure following accepted standards. This is a big shift from his previous views which simply painted the whole industry as a bad thing.

Considering that spot Ethereum ETFs have not been launched yet, Gensler’s comments on potential ETFs for meme coins like BONK show that SEC acknowledges that more crypto ETFs would be launched in the future.

Apparently, the abrupt change in Gensler’s rhetoric signals a major political shift. Although crypto is not yet a key issue for voters, the market is too big to ignore for candidates during the election year in the U.S. The political cost of opposing crypto has grown in recent years, so U.S. regulators would use more subtle methods to control the industry. At this point, blanket bans are impossible.

Most likely, we’ll see more crypto ETFs approved in the foreseeable future. There’s demand for popular names other than BTC and ETH in the traditional finance space.

Hardcore crypto fans may wonder why anyone would choose to buy an ETF instead of real crypto, but market action shows that some investors will not move out of the realm of traditional markets. Such investors could have their own reasons for their choice, including tax ones. Tax situations are wary, and buying an ETF on a traditional exchange could be more tax-efficient for some investors than buying real crypto.

Therefore, such investors will have to wait for spot crypto ETFs to get exposure to crypto. Major investment firms would like to reap hefty commissions from such clients, so the supply of spot crypto ETFs would grow as they navigate the regulatory waters.

Talking about meme coins, there’s too much risk that any single meme coin would go bust at a time when an investment firm creates a spot ETF product for this coin. At the same time, demand for meme coins is growing, especially among younger investors. There’s an elegant solution though: release a spot ETF for a pool of popular meme coins.

In this scenario, the failure of any single coin would not destroy the whole product. Such an ETF would be harder to approve, so we should not expect it this year. As the spot ETF industry grows, demand for new products will be hard to ignore, so investment firms will find a way to sell their clients a ‘basket’ of meme coins.