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The US Securities and Exchange Commission (SEC) has hit the brakes on approving two major proposals for Solana exchange-traded funds (ETFs).
In Brief
- The SEC has delayed approval of Solana ETF proposals from Bitwise and 21Shares.
- The delay is due to concerns about market manipulation and investor protection.
- Despite the delay, Solana’s price continues to rise and investor interest remains strong.
SEC Scrutinizes Solana ETF Proposals Over Compliance and Market Risks
The Solana ETF proposals by Bitwise and 21Shares have been delayed as the SEC begins a new round of proceedings to assess whether they comply with key rules under the Securities Exchange Act.
The SEC flagged concerns about market manipulation and investor protection, which are key issues it must consider before giving the green light to any ETF listing.
Bitwise submitted their application earlier this year through Cboe’s BZX Exchange. Meanwhile, 21Shares, which already manages ETFs for Bitcoin and Ethereum, also wants in on the Solana action. Despite their experience, the SEC hasn’t approved any Solana ETFs yet.
Solana is often praised for being faster and cheaper to use than Ethereum, making it popular with crypto fans. Still, the financial watchdog is cautious and wants to ensure any ETFs tied to Solana won’t cause problems down the line.
The agency stated in a release that it also wants public feedback on the proposal to list and trade shares of a trust that holds SOL, the cryptocurrency. It stated:
In particular, the Commission seeks comment on whether the proposal to list and trade Shares of the Trust, which would hold SOL, is designed to prevent fraudulent and manipulative acts and practices or raises any new or novel concerns not previously contemplated by the Commission.
Crypto ETFs Still Stuck in Regulatory Slow Lane
This isn’t just about Solana. The SEC has been slow to approve crypto ETFs across the board lately. There are many applications waiting while the regulator figures out how best to handle these new types of investments.
That said, some market watchers remain hopeful. Analysts from Bloomberg previously estimated that most of these crypto ETFs will be approved before the year’s end. They put the chances at about 90% for both Solana and Litecoin ETFs.
This optimism is partly fueled by pro-crypto President Donald Trump, who pledged to make the U.S. the world’s crypto capital. His commitment was clear when he signed an executive order to establish a strategic Bitcoin reserve and a U.S. digital asset stockpile. Rising institutional interest has also contributed to this positive outlook.
Despite these encouraging developments, the wait for a Solana ETF continues. The SEC’s latest delay means a final decision could be pushed well into the latter part of the year.
Solana’s Price Keeps Climbing Despite the Hold-Up
Despite the SEC’s delays, Solana’s price hasn’t missed a beat, climbing more than 3% in the last 24 hours alone. Top crypto commentator on X, Ali Martinez, revealed that the number of wallets holding 0.1 or more Solana has reached a new all-time high of 11.16 million, showing growing accumulation of the token.
Another analyst, Cas Abbé, emphasized that Solana’s multi-year uptrend remains intact. He explained that last month, SOL retested the trendline that marked its bottom, and since then, the token has surged over 50% as its fundamentals continue to improve. Cas remains confident that $290 wasn’t SOL’s peak and expects it to hit a new all-time high in 2025.
SEC approval of Solana ETFs could trigger another price surge, similar to Bitcoin’s response to ETF approval in January 2024. ETFs typically provide easier and safer investment access, often driving prices higher.
The SEC’s measured approach demonstrates their caution with crypto investments. While investors may find the delays frustrating, eventual approval of Solana ETFs could catalyze increased investment and price appreciation.
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Ifeoluwa specializes in Web3 writing and marketing, with over 5 years of experience creating insightful and strategic content. Beyond this, he trades crypto and is skilled at conducting technical, fundamental, and on-chain analyses.
DISCLAIMER
The views, thoughts, and opinions expressed in this article belong solely to the author, and should not be taken as investment advice. Do your own research before taking any investment decisions.
