The SEC’s decision to freeze all applications for new ETF issuers that want to use swaps and derivatives is a boon for ProShares, Direxion, Rydex, iShares and even ETN issuers.

As reported here, the SEC has temporarily stopped issuing OKs for new ETF firms to develop ETFs that rely on swaps and other derivatives. That primarily impacts leveraged and inverse ETFs, but also applies to certain actively managed strategies.

The reason for the freeze is simple: There was a lot of bad publicity (and some bad investor experiences) surrounding existing swap-based ETFs and derivatives in general, and the SEC wants to step back and slow new filings while it gets a handle on those issues.

For those of us around the industry, it’s a reminder of the old days when the SEC took more than six years to approve the first leveraged and inverse ETFs. At the time, it was concerned about opening a Pandora’s box of swap-based products. It eventually gave ProShares and others the go-ahead, but it looks like we could be entering a deep freeze again.

Olly Ludwig did a good job laying out who this freeze hurts in his article on the move, but the article doesn’t dig into who this helps, which is pretty clear: Everyone already in the market.

In essence, the SEC has helped companies that already have approval to launch derivatives-based ETFs. ProShares and Direxion will probably make the most of it. They both have large existing franchises in leveraged and inverse ETFs, which are now effectively guarded from competition. And they are each either interested in or already moving into actively managed funds based on derivative contracts. Now, rather than dealing with five or more new competitors, they probably have a year or more to sit back, figure out that market and build first-mover advantage.

The other unsung winners in this are ETNs. As structured notes, they can package together the kind of returns you gain from derivatives without (I believe) falling under the purview of the SEC’s new review. So look for more new products from ETN issuers as well.

In the end, the SEC review is probably a good thing. The issues the SEC has outlined, including whether firms have adequate risk management techniques and adequate portfolio disclosures, are real ones.

I would add to the SEC’s list looking at whether companies should be forced to disclose their counterparties on a real-time basis. That strikes me as critical information that all investors should know.