Review of Solana ETF Applications by SEC
Chicago Board Options Exchange (CBOE), VanEck, and 21Shares have made significant strides by seeking approval from the SEC for a Solana ETF. These requests, submitted through Form 19b-4, empower self-regulatory organizations (SROs) to inform the SEC about proposed rule modifications. The SEC collects public opinions and takes into account feedback during the scrutiny of these applications.
Deadline for SEC Decision
The SEC has a deadline until mid-March 2025 to address the proposal for Solana ETFs to be traded on the spot market. This process mirrors the methodology employed for Bitcoin and Ethereum ETFs, where public responses play a critical role. Analysts opine that the probability of Solana ETF approval hinges on the political landscape post the 2024 Presidential elections.
ETF analyst Eric Balchunas suggests that a potential Donald Trump presidency could foster a more favorable climate for cryptocurrency markets, thereby enhancing the likelihood of Solana ETF approval. Conversely, a Joe Biden presidency might usher in stricter regulations, complicating the approval process for the ETF. Political conditions significantly impact the SEC's decision-making.
Perspectives from Analysts
Nate Geraci, President of ETF Store, highlights that the evaluation process commences once the SEC accepts the applications. Subsequent to this announcement, there was a positive upturn in Solana's market performance, with a 6.47% price surge in the last 24 hours, reaching $141.07. Matthew Sigel, the head of research at VanEck, remains hopeful about the potential for a Solana ETF, drawing inspiration from the successful approval of Ethereum's spot ETF.
However, regulatory barriers present a formidable challenge. ETF analyst James Seyffart observes that Solana encounters more regulatory hurdles compared to Ethereum. The SEC's classification of Solana as a security, evident in lawsuits against Coinbase and Kraken, complicates the approval process.
Future of Solana ETFs
The prevailing political climate is set to play a crucial role in determining the destiny of Solana ETFs. The favorable stance towards cryptocurrency under the Trump administration could advance the ETF approval process. Conversely, stringent regulatory measures under the Biden administration may diminish the prospects of Solana ETF approval.
Investors and analysts keenly monitor the SEC's assessment process, which encompasses public feedback and comments. The recent surge in Solana's price reflects optimistic market projections regarding ETF approval. Nonetheless, the ultimate decision lies with the SEC, subject to influences from the political and regulatory domain.
