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Unveiling the Excitement Around Solana ETFs: Feasibility and Arrival Timelines…
Unveiling the Excitement Around Solana ETFs: Viability and Anticipated Release Dates Explored
The focus of the cryptocurrency sphere shifted towards Solana today following a firm’s application for a Solana ETF.
Authored by:
Mete Demiralp
June 27, 2024 – 19:52
Last Updated:
1 day ago
0
VanEck, an investment management entity based in New York, has a reputation for its keen interest in the crypto domain and has recently submitted a proposal to establish an ETF monitoring Solana’s price movements. Nevertheless, obtaining approval for this ETF from the current administration appears uncertain.
This application marks the debut endeavor to introduce a Solana (SOL) ETF in the United States. Many analysts had foreseen this move after the recent authorization by the US Securities and Exchange Commission (SEC) for funds based on Ethereum. However, the success of this initiative remains in question.
Hinging on the viewpoints of Bloomberg Intelligence’s ETF specialist James Seyffart, the possibility of the fund launching in 2025 hinges on a potential shift in White House leadership and the SEC’s stance. Even under those circumstances, its fruition is not guaranteed, according to the analyst.
Debates surrounding Solana’s decentralization versus Ethereum further complicate matters. While some advocate for Ethereum’s superior decentralization, figures like Solana developer and Helius founder Mert Mumtaz argue that Solana sits among the top 1% in decentralized network rankings.
Qureshi highlighted that Bitcoin and Ethereum-linked ETFs stand a better chance of meeting the SEC’s surveillance criteria due to the existence of robust futures markets where these assets are traded. He emphasized that failing to have a listed futures market would hinder meeting the market surveillance standards.
Jake Chervinsky, Chief Legal Officer at Variant Fund, concurred with Qureshi and forecasted that the absence of a futures market for Solana could be a basis for rejection by the SEC.
In a similar vein, Austin Campbell, a faculty member at Columbia Business School, expressed skepticism regarding the approval of VanEck’s application. He suggested that the approach seemed to be geared towards early entrance, raising inquiries on whether other entities would follow in VanEck’s footsteps, akin to what unfolded post-BlackRock’s unexpected submission of a Bitcoin ETF application in late 2023.
Van Buren Capital’s General Partner, Scott Johnsson, speculated that VanEck’s application might potentially tarnish President Biden’s standing given the prevalent belief in his administration’s anti-crypto stance. He lauded the move as a shrewd tactic to test limits and cast doubts on the SEC’s crypto regulatory procedures.
According to Brian Frye, a law professor at the University of Kentucky, the final approval of Solana ETFs seems inevitable provided market conditions are favorable, considering that from a regulatory aspect, Ethereum and Solana are fundamentally akin. However, he warned that this process might be time-consuming due to the SEC’s sluggish pace and the current leadership’s tepid enthusiasm towards cryptocurrencies in general and ETF approvals specifically.
*This does not constitute investment advice.
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