Solana ETF Faces Regulatory Hurdles, Could Wait Until 2025, Bloomberg Analyst Says

• VanEck has filed an application for Solana ETF in the US.
• Bloomberg ETF said approval might not come until 2025 due to regulatory strain.

Bloomberg analyst James Seyffart says the first Solana (SOL) Exchange-Traded Fund (ETF) filed by VanEck might face regulatory hurdles in the US. The analyst highlights 2025 as the possible timeline for the Solana ETF launch.

Regulatory Hurdles Plaguing Solana ETF Launch

Taking to the X platform, Seffart stated that the Solana ETF launch will depend on a new White House administration. He added that a possible change in leadership at the US Securities and Exchange Commission (SEC) could also influence the ETF launch. Even in this scenario, the analyst says getting a Solana ETF is not guaranteed.

First SOL ETF filing in the U.S. Will be interesting to see if other issuers immediately follow suit. Early thoughts are that this only has a shot to launch sometime in 2025 if we have a new admin in the White House and SEC. Even then not guaranteed. https://t.co/I1yoWNpdd4

— James Seyffart (@JSeyff) June 27, 2024

In a follow-up post, Seffart says there is currently no deadline for VanEck’s SOL ETF filing because it is only in its initial phase, S-1 registration. He said a different filing (19b-4) would provide more details about the approval timeline. Even with a 19b-4 filing, Seyffart noted that approval could take until mid-March 2025.

While commenting on the matter, a follower stated that the approvals of Ethereum ETFs are a nightmare for the SEC. The follower claims it opens the door to other cryptocurrencies like Solana, making regulation more complex for the SEC. In their view, the SEC should have denied applications for ETH ETFs and classified the cryptocurrency as a security.

“This wasn’t done because they would lose that battle in court lol. Wasn’t an option IMO,” Seffart replied. Per Solana classification, Matthew Sigel, VanEck’s Head of digital assets research, argues that it functions similarly to established digital commodities like Bitcoin and ETH.  “SOL is utilized to pay for transaction fees and computational services on the blockchain,” Sigel wrote in an X post.

VanEck’s Interest in Solana

According to a prior report by Crypto News Flash, VanEck became the first issuer to file a SOL ETF in the United States on Thursday. The filing comes only a few days after 3iQ filed for a similar product in Canada, as previously reported by Crypto News Flash.

Sigel explained that VanEck’s interest in a Solana ETF stemmed from Solana’s competitive edge against Ethereum. He highlighted its “unique combination of scalability, speed, and low costs” as attractive features. 

VanEck’s Solana ETF application highlights its reputation as a frontrunner in the crypto space. The company was the first to file a spot ETH ETF in 2021, ahead of the SEC’s recent engagement with issuers like BlackRock and Fidelity. The firm followed up with an additional filing last year, demonstrating its continued commitment to bringing crypto ETFs to market.

Industry experts believe that SOL’s characteristics position it as a strong contender for the next crypto ETF. This is given its similarities to Ethereum. Interestingly, the news of VanEck’s SOL ETF filing sent positive ripples through the crypto market. It pushes the SOL token to an almost 8% gain in 24 hours. 

As of this writing, SOL is trading at $145.15, demonstrating a 6.8% surge within a 24 hour period. Its market cap now comes ind at $67 billion.