Key Takeaways
- Growing Competition for Solana Spot ETF Approval: Eight major financial firms, including big names like VanEck, Fidelity, and Franklin Templeton, are actively filing to launch Solana spot Exchange-Traded Fund (ETFs) in the US
- Third In The Line: Following the approval, Solana will become the third crypto approved for ETF trading.
- SEC Focus on Staking and Regulatory Review: The Securities and Exchange Commission (SEC) is carefully reviewing these filings, with particular attention on how the ETFs will handle staking, highlighting concerns about investor protection and regulatory compliance.
- Potential Market Impact and Approval Timeline: The SEC has delayed decisions before but is now advancing the review process. Industry experts expect an announcement soon, which could open up new opportunities for both retail and institutional investors to access Solana ETFs in the US.
Eight Firms Race for SEC Approval
The competition to secure approval for a spot Solana exchange-traded fund (ETF) in the US is heating up, as eight prominent financial companies prepare their filings. If approved, Solana could become the third cryptocurrency to gain the green light for ETF trading in the country. The US Securities and Exchange Commission (SEC), which oversees and regulates securities markets, will play a pivotal role in reviewing and deciding on these ETF proposals, assessing them for various aspects, including investor protection, market integrity, and compliance with federal securities laws.
SEC Requests To Include Staking Language in All Filings
Recent revisions to registration filings show that regulators have directed all applicants to address staking — a process through which investors can earn rewards by participating in blockchain transaction validation. This request underscores the SEC’s heightened attention to how spot Solana ETFs will manage the network’s proof-of-stake protocol.
The move comes amid a broader push by traditional asset managers to tap into rising institutional interest in crypto, following the successful rollout of Bitcoin and Ethereum ETFs.
VanEck and 21Shares Lead Early Filing Race
VanEck, the global investment management firm, emerged as the first mover, filing its BNB ETF recently and a Solana ETF application nearly a year ago, despite the SEC’s previous stance that Solana constituted a security. The firm positioned its filing as a strategic bet on regulatory changes following the November election results.
The Swiss investment firm 21Shares followed closely behind, with both companies now advocating for a “first-to-file” approval approach rather than the SEC’s precedent of approving multiple crypto ETFs simultaneously. VanEck argues this method better promotes innovation and competition in the market.
Major Asset Managers Enter Competition
Established financial giants have also joined the race, with the prominent financial services firm Fidelity being one of them. The company’s Bitcoin ETF ranks second in assets under management behind BlackRock, and it could drive substantial investor inflows if approved. The firm already offers Bitcoin and Ethereum ETFs and manages various cryptocurrency initiatives.
Franklin Templeton, managing $1.5 trillion in assets, is another name on the bandwagon. In 2024, it expanded its crypto options by adding Solana to its token-based money market fund. They also included Solana in a special digital assets investment account they manage separately.
Specialized Crypto Firms Join Race for Approval
Grayscale, a well-known US company that manages digital assets, is also trying to turn its existing Solana Trust into a spot ETF, similar to what it did with Bitcoin and Ethereum. Right now, the trust is trading at a higher price than its actual value, showing that many investors want a regulated way to invest in Solana.
At the same time, Canary Capital, another US digital asset company, jumped into the race by applying for its own Solana ETF just days before the US election. This shows that more competition is heating up in the crypto ETF market.
Shortly after the election, Bitwise, a US firm focused on crypto ETFs, also filed for the ETF. Their CEO, Hunter Horsley, called Solana an “amazing new asset.” Bitwise even launched a Solana staking product last December, which could help them get approval for an ETF that supports staking.
CoinShares became the latest entrant, joining the competition as existing applicants submitted revised documentation. The European asset manager brings experience from operating cryptocurrency ETPs across multiple digital assets.
SEC Approval May Soon Happen
The SEC previously delayed Grayscale’s decision, stating it hadn’t reached conclusions on the regulatory framework. However, recent filing amendments suggest approval processes are advancing.
Companies have already established partnerships with staking providers to manage the technical aspects of earning blockchain rewards. VanEck uses Kiln for its European products, while Bitwise partners with Marinade. These relationships could influence how approved ETFs generate additional returns for investors.
Industry observers expect the SEC to announce the decisions soon, potentially bringing institutional-grade Solana investment products to US retail and institutional investors for the first time.
