As the SEC mulls next steps for novel ETFs, many in the industry argue existing securities laws are sufficient. Bitwise's general counsel, Johanna Collins-Wood, told Bloomberg that the SEC should apply rules as written, not read new things into them. Others, like Franklin Templeton and GraniteShares, echo this sentiment in comments submitted to the regulator.

A broader point in the comments is that not all novel ETFs are the same. A spot crypto ETP, for instance, sits on more mature infrastructure than years ago, so grouping it with private-asset or leveraged single-stock funds may obscure risks. The industry prefers assessing each product's actual risk rather than treating all as equally dangerous.

However, Benjamin Schiffrin of Better Markets, a former SEC staffer, takes a tougher stance, especially on leveraged ETFs. He argues these products are inappropriate for retail investors and should have stricter disclosure, possibly with bold, repeated warnings on every page. The tension is clear: industry sees innovation, while advocates see potential harm.

Meanwhile, Defiance ETFs recently filed to launch hourly leveraged ETFs on major tech names, highlighting Wall Street's appetite for such products despite regulatory debate. The SEC's 60-day comment period has closed, with no shortage of opinions from exchanges like Nasdaq and groups like SIFMA.