US Government Shutdown Halts SEC Operations – Crypto ETF Reviews on Hold

The U.S. government shutdown has forced the Securities and Exchange Commission (SEC) to scale back its operations, with most staff furloughed. As a result, crypto-related enforcement cases and ETF reviews are expected to pause until funding is restored.

• The SEC began shutting down on Wednesday due to a lapse in government funding.
• Only an “extremely limited” number of staff will remain active.
• Enforcement actions, lawsuits, and ETF reviews are likely paused.
• Crypto ETF approvals, including Solana ETF applications, may face delays.
• Lawmakers in Congress have not yet reached a deal to reopen the government.

The U.S. Securities and Exchange Commission (SEC) began its shutdown procedures on Wednesday after Congress failed to pass a bill to continue government funding. According to an official statement, most SEC employees were told to secure their work and prepare for what could be a multi-day pause in normal operations.

The SEC said it would operate with an “extremely limited number of staff” under its August contingency plan. Many systems will continue to function but under “modified conditions.” Non-essential personnel were instructed to stop work and wait for notice once government funding is restored.

During the shutdown, the SEC confirmed that it will not engage in ongoing litigation or enforcement actions, except in emergency cases where property or assets are at risk. This effectively puts crypto company investigations and lawsuits on hold.

The agency also said it cannot review new registration filings, approve rule changes, or process non-urgent requests from self-regulatory organizations. For the crypto market, this means exchange-traded fund (ETF) applications — including those tied to Solana (SOL) and other digital assets — will likely face delays. Although the SEC’s electronic filing system remains active, no applications will be reviewed until normal operations resume.

Analysts had expected the SEC to approve several Solana ETFs by mid-October, but those decisions could now be postponed.

At the same time, political divisions in Congress have prolonged the funding deadlock. Speaker of the House Mike Johnson said lawmakers will reconvene next week but ruled out changes to the Republican-backed funding bill. Democrats continue to push for reversing healthcare cuts in the proposed budget, delaying any compromise.

Under its current shutdown plan, SEC employees will return to work on the first regular workday after a new funding agreement is passed. Until then, most agency operations remain frozen, leaving uncertainty for both the traditional and crypto markets.

Final Thought

The SEC’s limited operations during the government shutdown could create short-term uncertainty for crypto investors and ETF applicants. While the agency’s pause is temporary, it highlights how political gridlock in Washington can ripple through financial regulation — delaying progress just as the U.S. crypto market gains mainstream attention.