Solana Spot ETF Approval Timing, Details in Full: SEC’s Decision Due Late January

• Bitwise, VanEck, 21Shares, and Canary Capital have also filed for spot Solana ETFs.
• Litecoin, Ripple, and other altcoin exchange-traded products are being proposed.
• The SEC is expected to make initial decisions by the end of January.

The excitement around the prospect of spot Solana (SOL) exchange-traded funds (ETFs) is beginning to ramp up as the U.S. Securities and Exchange Commission (SEC) has just a couple of weeks to review and respond to applications.

Solana ETFs?

With spot Ethereum ETFs launching on July 23, all eyes are on the top altcoin to see which one has the credentials to be the next spot crypto ETF.

While many consider Ripple (XRP) a strong candidate, several industry experts and Ripple CEO Brad Garlinghouse think SOL is the next logical choice.

However, due to numerous regulatory hurdles and ongoing court cases with the U.S. Securities and Exchange Commission (SEC) to determine how certain cryptos are classified, a spot SOL or spot XRP ETF may not happen anytime soon.

However, it may come in a different form. Nate Geraci, President of the ETF Store, recently suggested  that a spot SOL ETF could be part of a combined spot ETF, packaged alongside BTC and ETH.

SEC Deadline Looms

At present, five firms—Grayscale, Bitwise, VanEck, 21 Shares, and Canary Capital—have submitted their spot Solana ETF applications.

Under regulatory requirements, the SEC has 45 days to make an initial decision after accepting applications. This means that Grayscale could receive a decision by Jan. 23, 2025, with the others coming in the days that follow.

Much of the excitement comes as crypto’s least-favorite regulator, SEC Chairman Gary Gensler, will be stepping down from his role on Jan. 20.

In his place, Donald Trump has named pro-crypto candidate Paul Atkins his top choice to take over the SEC.

As per a “Solana ETF Approved in 2025?” contract on crypto betting marketplace Polymarket, bettors believe there’s a 74% chance  they’ll be approved this year.

The hype hasn’t quite transferred to SOL’s price, which, much like the rest of the market, is experiencing a downturn. SOL is presently trading at $191.08 , down 2.24% in the past 24 hours.

Launch Conditions

The road to a spot SOL ETF will be bumpy. First, the SEC would have to reverse its lawsuits against Coinbase , Kraken , and Binance , in which it names Solana as one of the many unregistered securities sold by crypto exchanges.

Furthermore, no SOL-based futures products are trading on U.S. stock exchanges. Typically, a futures commodity needs to trade for 18 to 24 months before the SEC considers approving it as a spot product.

Presently, there are a few Solana-based exchange-traded products (ETPs) trading. These include the Grayscale Solana Trust (GSOL ), the VanEck Solana  exchange-traded note (ETN), and the 21Shares Solana (ETP).

Eyes on Solana

Arguably, the approval of spot ETH ETFs could be interpreted as a regulatory endorsement of broader crypto technologies and tokens, or at least a step in that direction.

As highlighted by Matrixport co-founder Daniel Yan , SOL could follow both BTC and ETH, positing that Solana is a better investment. Furthermore, SOL is undeniably popular amongst crypto users.

Seemingly, there’s plenty of appetite for a SOL ETF.

However, as Gensler highlighted , crypto ETFs such as Ethereum have to go through rigorous processes to be approved, and given the timeline, Solana ETFs could still be years out.

“Ethereum had been traded on the Chicago Mercantile Exchange futures for three-plus years. And the staff looked at that closely, and that was approved,”

Gensler said that the SEC’s role is to ensure that investors are protected with legally required disclosures and that exchanges are adequately regulated to prevent fraud, market manipulation, and other nefarious activities.

Whilst the SEC is seemingly warming to crypto, altcoins probably have a long way to go before trading as ETFs on U.S. exchanges. At best, the SEC could begin considering SOL fund applications in 2025.

However, this primarily depends on several major factors, including the fact that it is classified as an unregistered security, as per several lawsuits from the SEC regarding crypto exchanges.

SOL ETF Filings

Grayscale

According to a filing  from the New York Stock Exchange (NYSE), Arca, Grayscale has joined Bitwise, VanEck, and others in lining up to have their spot Solana ETF applications approved.

The filing with the U.S. Securities and Exchange Commission (SEC) officially begins, which would see Grayscale convert its existing Solana Trust, GSOL, into a spot ETF on NYSE Arca.

With some $120 million in assets under management (AUM), it would be a modest conversion compared to its Bitcoin (BTC) Trust, which carried around $30 billion in AUM at the time of conversion.

This has since dwindled to $20.59 billion as Grayscale’s spot BTC ETF has suffered almost endless outflows.

Hopefully, this won’t be the same for its Solana ETF ambitions.

Bitwise

Asset management firm Bitwise has filed  to set up a statutory trust entity in Delaware for its Solana ETF application.

The preliminary step can be seen as a mark of confidence from the firm, as typically, such moves are made before companies file the necessary 19b-4 filing and S-1 registration forms for regulatory approval.

Bitwise joins VanEck, 21Shares, and Canary Capital who are also gearing up to launch Solana ETFs. The moves follow Bitwise’s bold S-1 registration for a Ripple (XRP) ETF in early Oct.

Canary Capital

Digital asset manager Canary Capital has filed  for a spot Solana ETF with the SEC.

As per the S-1 filing, Canary’s spot SOL ETF seeks to track SOL’s performance via the CF Solana Index. Canary Capital has not yet disclosed its chosen custodian or ticker symbol.

Canary Capital recently filed for a spot Ripple (XRP) ETF and a spot Litecoin (LTC) ETF earlier this month.

Franklin Templeton is reportedly also mulling the option.