Solana Futures Launch on CME

Following the launch of Solana (SOL) futures on the Chicago Mercantile Exchange (CME) yesterday, trading activity was minimal, raising concerns about institutional demand for the altcoin, according to a report by K33 Research.

K33 Research Head Vetle Lunde and Senior Analyst David Zimmerman noted that Solana futures recorded only $12.3 million in volume on their first day, with open interest at $7.8 million. This sluggish start is a stark contrast to earlier CME futures launches for Bitcoin and Ethereum, which experienced significantly higher interest.

Bitcoin futures were launched on the CME in December 2017, achieving $102.7 million in trading volume and $20.9 million in open interest on their first day. Ethereum futures, launched in February 2021, saw $31 million in volume and $20 million in open interest on their debut.

Lunde and Zimmerman pointed out that the market environment during Solana’s futures launch was notably more risk-averse than during previous launches. The current market lacks strong catalysts to drive speculative interest in new derivatives, unlike the peak of the 2017 crypto bull market or the early 2021 altcoin season.

While Solana’s futures launch aligns with historical market cap trends, the absolute numbers are significantly smaller. This tepid response raises concerns about the potential impact of a Solana spot exchange-traded fund (ETF) if it gains U.S. approval this year. Analysts at K33 believe that, in contrast to the landmark U.S. spot Bitcoin ETF launch in January 2024, an altcoin ETF—including one for Solana—may have a more limited impact on price action.

This is not investment advice.