Solana ETFs Approval: A Uncertain Future

Despite favorable odds for approval, the debut of exchange-traded funds (ETFs) based on Solana’s price in the U.S. remains uncertain, pending regulatory review, enforcement actions, and public comments on multiple filings.

A lot can change for Solana hopefuls before they potentially start trading.

> “Right now, the only thing that’s happened is they didn’t get a phone call telling them to go away,” Bloomberg Senior ETF Analyst Eric Balchunas told Decrypt.

The SEC began assessing applications for spot Solana ETFs this week. The deadline for these decisions can be extended as late as October 16.

Approval of Solana ETFs would broaden access to digital asset-focused products after the success of Bitcoin and Ethereum ETFs last year, which allowed traditional financial institutions to invest billions and boosted crypto markets.

Major asset managers like Grayscale, Bitwise, Canary, 21Shares, and VanEck have filed applications for Solana ETFs with the SEC. Balchunas estimates a 70% chance that Solana ETFs will be approved this year, but the timing remains uncertain.

> “Our official altcoin ETF approval odds are out. Litecoin leads with a 90% chance, then Doge, followed by Solana and XRP,” Balchunas tweeted.

Despite a crypto-friendly stance from the SEC under President Trump, the process remains unclear. Balchunas noted the SEC’s history of delaying decisions on Bitcoin and Ethereum ETFs.

Lawsuits, Statements, and Feedback

A crucial development would be if the SEC starts providing feedback on asset managers’ proposed rule changes. This would suggest the SEC is seriously engaging with asset managers regarding Solana ETFs.

Monitoring ongoing enforcement actions during Gensler’s leadership, including the SEC’s 2023 lawsuit against Coinbase, will also be crucial. If the SEC retracts its legal stance against Coinbase and Solana, it could signal positive momentum for ETF approval.

Paul Atkins, Trump’s nominee for SEC Chair, could influence this process. Even though he has not been confirmed, any relevant comments from him could be seen as a positive sign.

‘In the Bag’

With the current administration’s favorable view towards crypto, some analysts believe the conditions for Solana ETF approval might already be in place.

> “I don’t want to say it’s in the bag, but the SEC’s change of tune is really something,” said Bitwise Senior Investment Strategist Juan Leon.

With previous concerns over fraud and market manipulation, the SEC changed its stance following Grayscale’s legal victory, leading to Bitcoin ETF approvals.

Additionally, Coinbase recently launched futures contracts for Solana, which could positively influence the chances for a Solana ETF approval.

> “I think this move by Coinbase really increases the odds of a Solana ETF,” Leon stated.

Edited by James Rubin