Solana News Today: Cboe Files Solana ETF as SEC Delays Crypto Approvals

Cboe BZX has filed for a listing of the Invesco Galaxy Solana ETF, marking a significant step toward providing regulated access to the Solana (SOL) token in U.S. markets [1]. This proposal comes as the U.S. Securities and Exchange Commission (SEC) continues to delay decisions on several crypto-related ETF applications, including the Invesco Galaxy Ethereum Staking ETF and the Truth Social Bitcoin ETF [1]. The proposed ETF will track the Lukka Prime Solana Reference Rate, which aggregates prices from major exchanges every 15 seconds to ensure accurate and real-time pricing for investors [1]. The fund also intends to stake a portion of its SOL holdings, potentially generating additional returns for investors through trusted staking providers.

The development highlights a growing trend of institutional interest in crypto assets and the increasing efforts to bring them into the traditional financial system [1]. Cboe BZX and other exchanges are actively pushing for regulatory clarity and streamlined approval processes for crypto ETFs, with some proposing that certain products be automatically approved without case-by-case reviews [1]. This would align the treatment of crypto ETFs with that of traditional asset classes, potentially accelerating the availability of regulated investment vehicles for digital assets.

Despite these advancements, analysts warn of the inherent risks associated with staking-based products like the Invesco Galaxy Solana ETF [1]. The structure of Solana’s proof-of-stake network, where a small number of validators control a large portion of staked SOL, raises concerns about centralization and the potential for market manipulation [1]. Kadan Stadelmann, CTO at Komodo Platform, emphasized that these structural risks must be carefully considered when evaluating the regulatory viability of such products [1]. The ETF filing argues, however, that Solana’s market characteristics justify its approval without the need for a surveillance-sharing agreement—a mechanism typically used for traditional asset ETFs to monitor for market abuse.

The SEC’s cautious approach underscores the broader regulatory uncertainty surrounding crypto ETFs [1]. While the agency has shown some pro-crypto leanings under current leadership, its recent delays in approving or rejecting applications indicate a need for further review and legal scrutiny [1]. This uncertainty affects not only the proposed Solana ETF but also the broader market, as investors and institutions await clarity on how crypto assets will be treated under existing financial regulations [1].

The proposed Solana ETF could serve as a model for future listings of other major cryptocurrencies, signaling a shift toward treating digital assets as institutional-grade investment products [1]. If approved, it would provide a more accessible and familiar entry point for both institutional and retail investors who are hesitant to trade directly on crypto exchanges [1]. The outcome of this and other pending applications will likely shape the trajectory of crypto adoption in the traditional financial sector, with potential implications for market liquidity, investor confidence, and regulatory policy.

Source: [1] US SEC Delays Review of Truth Social Bitcoin ETF and Grayscale Solana ETF (https://m.sosovalue.com/assets/etf/us-btc-spot)