Solana ETFs Move Closer to Approval as Firms Submit Updated Filings

Several firms have submitted updated S-1 filings to list spot Solana exchange-traded funds, a move that some experts say signals the U.S. Securities and Exchange Commission is closer to approving these products. Investment firms Franklin Templeton, Galaxy Digital, and VanEck submitted updated S-1s, a registration statement needed for an ETF to gain SEC approval for public trading. Grayscale also filed an update and disclosed a 2.5% fee with the prospective fund. Fidelity also submitted its Solana Fund S-1, with someone familiar with the matter confirming that this is Fidelity’s first S-1 filing for a spot Solana ETP.

Earlier this week, several potential Solana ETF issuers were approached by the SEC with a request to update their S-1s. This indicates the agency is more likely than before to approve some of these products, giving a timeline of two to four months for spot SOL ETFs to go live. The SEC reportedly asked issuers to update language surrounding in-kind redemptions and how issuers would approach staking. VanEck added staking to its prospective Solana ETF in its updated statement. The SEC has approved spot Bitcoin and Ethereum ETFs as well as a number of blended crypto-equity funds. However, it has been hesitant to allow issuers to list products that track alternative tokens, despite the number of filings for products like Avalanche, Dogecoin, and Hedera funds. The agency recently delayed making a decision on several of those products and requested public comment.

Some experts think Solana has a better chance at approval under a friendlier SEC administration, especially in light of the CME’s listing of SOL futures, which is not an essential step in the ETF listing process but is typically seen as beneficial. Recently, prospective ETF issuers, including VanEck and 21Share, pressed the SEC to follow its traditional "first-to-file approach," wherein the agency greenlights product proposals on a first-come, first-served basis.

Several prospective issuers of Solana (SOL) exchange-traded funds (ETFs) have submitted updated S-1 filings, indicating a potential move towards listing. This development suggests that these issuers are actively engaging with the SEC, as the regulator has requested updated filings within a week, signaling ongoing dialogue and potential progress towards approval. The submission of updated S-1 filings by these issuers is a significant step in the process of bringing a SOL ETF to market. The SEC's request for updated information within a short timeframe indicates that the regulator is actively reviewing these applications and may be close to making a decision. This could be seen as a positive sign for the crypto industry, as it suggests that the SEC is open to considering ETFs based on alternative cryptocurrencies beyond Bitcoin and Ethereum.

The potential listing of a SOL ETF would provide investors with a new way to gain exposure to the Solana blockchain and its native token, SOL. This could attract more institutional investors to the crypto market, as ETFs are a familiar and regulated investment vehicle. Additionally, the approval of a SOL ETF could pave the way for other altcoin ETFs, further expanding the range of crypto investment options available to investors. However, it is important to note that the approval of a SOL ETF is not guaranteed, and the SEC has been cautious in approving crypto ETFs in the past. The regulator has previously expressed concerns about market manipulation and investor protection in the crypto industry. Therefore, while the submission of updated S-1 filings is a positive development, it remains to be seen whether the SEC will ultimately approve a SOL ETF.

In conclusion, the submission of updated S-1 filings by prospective SOL ETF issuers is a significant development in the crypto industry. It suggests that the SEC is actively reviewing these applications and may be close to making a decision. However, the approval of a SOL ETF is not guaranteed, and investors should remain cautious. The potential listing of a SOL ETF could provide investors with a new way to gain exposure to the Solana blockchain and its native token, SOL, and could attract more institutional investors to the crypto market.