U.S. SEC Engages on Solana Spot ETF Applications. Could Approval be Next?

According to Fox News reporter Eleanor Terrett, who cited two sources familiar with the matter, the U.S. Securities and Exchange Commission (SEC) is reportedly engaging with S-1 applications for spot Solana exchange-traded funds (ETFs).

🚨SCOOP: Talks between @SECGov staff and issuers looking to launch a $SOL spot ETF are “progressing” with the SEC now engaging on S-1 applications, according to two people familiar with the matter. These people say there’s a “good chance” we’ll see some 19b4 filings from…

— Eleanor Terrett (@EleanorTerrett) November 21, 2024

Fund Managers File for SOL ETF

VanEck was the first fund manager to file for a Solana ETF on June 27, shortly after the SEC approved 19b-4 forms for spot Ethereum ETFs. Applications from 21Shares and Canary Capital followed their submission.

Most recently, Bitwise registered a Solana ETF in Delaware on Wednesday, signaling its intention to submit an official S-1 filing. Meanwhile, Solana’s native token, SOL, has risen 8.3% in the past 24 hours to $254, with a market cap of $120 billion, making it the fourth-largest cryptocurrency by market capitalization.

Could Approval be Next?

As the crypto community anticipates a potential approval for a Solana ETF following recent SEC engagement, it’s important to note that filing 19b-4 forms does not guarantee the SEC will approve an ETF. For instance, in August, the SEC removed ETF applications from VanEck and 21Shares on the CBOE’s website. Some experts suggest this was due to skepticism within the SEC, under the leadership of Chair Gary Gensler, about approving such products at that time.

However, recent developments have sparked renewed optimism. Terrett noted that increased engagement from SEC staff, combined with expectations of a pro-crypto stance under the incoming White House administration, has boosted confidence in the potential approval of such ETFs.

This optimism aligns with the recent surge in Solana’s network activity. On November 19, the network recorded $11.84 million in total transaction fees and $5.92 million in revenue, driven mainly by memecoin transactions. 

Additionally, Solana-based decentralized exchanges (DEXes) recently surpassed $70 billion in trading volume over 30 days, further highlighting the network’s growing strength. Trading activity surged between November 4 and November 10, reaching $41 billion—more than double the $18.1 billion recorded the previous week. 

These figures highlight the ongoing growth of the Solana network, which may influence the discussions around a potential Solana ETF.