Fidelity’s Solana ETF Delayed by SEC’s Regulatory Review

Fidelity’s proposed Solana ETF, initially anticipated for 2025, has encountered regulatory delays due to the SEC's postponement of their framework review in the U.S. The SEC has requested all applicants to submit amendments for their Solana ETF filings, which has influenced the timeline of Fidelity’s spot-based Solana ETF. This delay comes amidst rising institutional demand, underscoring the need for prompt SEC actions.

The urgency for the SEC to act decisively follows the unexpected launch of the REX-Osprey SOL and Staking ETF (SSK), which began trading recently. This fund, regulated under the Investment Company Act of 1940, was automatically approved without formal SEC objection, potentially pressuring the Commission to act more decisively on similar offerings under the Securities Act of 1933. Fidelity, along with other firms like Bitwise and Franklin Templeton, is awaiting the SEC’s regulatory stance on their Solana ETFs. Institutional applications suggest strong interest, but a clear timeline remains elusive without SEC confirmation.

The postponement affects market dynamics, with Solana being directly impacted. Other cryptocurrencies like ETH and BTC are also observed. The REX-Osprey ETF success emphasizes the industry's willed progression despite regulatory uncertainties. Financial implications include potential market attention shifts towards approved crypto ETFs, with expectations for Solana to ignite similar surges seen historically with BTC and ETH ETF approvals.

If approved, the Solana ETF could trigger significant price and volume shifts in related assets. The REX-Osprey’s approval under the 1940 Act presses the SEC to consider similar directions under the 1933 Securities Act. Experts foresee increased regulatory movements in this context.

Fidelity's bid to launch a Solana ETF has been delayed once again, as the US Securities and Exchange Commission (SEC) confirmed the delay on July 7, 2025. The SEC has set a deadline for asset managers aiming to list a Solana ETF to refile revised S-1 documents within the next three weeks. This delay comes as the SEC is reviewing critical elements, including the need for issuers to clearly address, in "plain English," all factors that make crypto-based ETFs distinctive.

The SEC's guidance spells out that in order to be approved, issuers must clearly address, in "plain English," all factors that make crypto-based ETFs distinctive. This process often delays ETF launches by as much as 240 days. Under the new system, the SEC could reduce the timeline to around 75 days by applying a single, comprehensive framework for digital asset ETFs. The SEC's new rules are the first step towards the approval of applications for various types of crypto-related ETFs.

The stay order on Grayscale's GDLC ETF suggests that the SEC may be delaying multi-coin ETF launches until a comprehensive digital asset ETF framework is finalized. The SEC does not want to let anything launch under the 19b-4 process until they officially approve or come up with some framework for digital assets in the U.S. This delay is part of a broader shift in U.S. cryptocurrency regulation, as the SEC prepares new rules to accelerate crypto ETF listings.

The SEC's fast-tracking of Solana ETF approvals, urging issuers to amend and refile by the end of July, could trigger a major price surge for Solana. However, the delay in the launch of the Solana ETF is a setback for investors who were hoping to gain exposure to the cryptocurrency through an ETF. The delay is also a reminder of the regulatory challenges facing the crypto industry, as the SEC continues to grapple with how to regulate digital assets.

The delay in the launch of the Solana ETF is part of a broader trend of regulatory scrutiny facing the crypto industry. The SEC's review of critical elements, including the need for issuers to clearly address all factors that make crypto-based ETFs distinctive, is a sign that the regulator is taking a closer look at the industry. The delay is also a reminder of the importance of regulatory compliance for crypto companies, as they navigate the complex landscape of digital asset regulation.