KEY POINTS
- Coinbase's Sigel wrote that VanEck believes in Solana's decentralized nature
- Bloomberg's Seyffart said a 2025 launch is possible if a new White House and SEC admin is seated
- The SEC has yet to decide on the full approval of spot Ethereum ETFs
Solana (SOL), the native cryptocurrency of the Solana blockchain, soared Thursday after investment management firm VanEck filed with the U.S. Securities and Exchange Commission (SEC) for the country's first potential spot SOL exchange-traded fund (ETF).
The token's price surged by over 7% Thursday night, as per CoinGecko data. At one point during the night, the 5th largest digital asset by market value skyrocketed above $150. It has since stepped back to around $145 as of early Friday.
Solana's uptick came after VanEck's head of digital assets research, Matthew Sigel, announced that investment manager has become the first company to propose a spot SOL ETF. Sigel wrote on X (formerly Twitter) that VanEck believes Solana is a "competitor" to the Ethereum blockchain and its "unique combination of scalability, speed and low costs may offer a better user experience for many use cases."
He further noted that VanEck deems the SOL token is a commodity as it functions similarly to the world's two top cryptocurrencies, Bitcoin and Ether. "SOL's decentralized nature, high utility, and economic feasibility align with the characteristics of other established digital commodities," he added.
I am excited to announce that VanEck just filed for the FIRST Solana exchange-traded fund (ETF) in the US.
— matthew sigel, recovering CFA (@matthew_sigel) June 27, 2024
Some thoughts on why we believe SOL is a commodity are below.
Why did we file for it?
A competitor to Ethereum, Solana is open-source blockchain software designed to… pic.twitter.com/XwwPy8BXV2
Crypto industry experts and observers weighed in on the development. Pseudonymous memecoin investor Rex said the possibility of a spot SOL ETF is "bullish" as it could put altcoins – cryptocurrencies that are not Bitcoin – in a position to propel wider digital assets adoption.
Crypto enthusiast Stefan Luebeck suggested that the new ETF may be approved, but "maybe" after changes are made at the White House following the November election. Luebeck sees a 2025 approval for a spot Solana ETF.
For senior Bloomberg ETF analyst Eric Balchunas, Luebeck may have a point. He explained that the "knee jerk" reaction to filings such as the one VanEck made is the funds won't get approved without futures first. However, he said that a change in the country's highest political post could make anything possible in the crypto space.
The knee jerk reaction here is 'oh this will never be approved bc there aren't Solana futures' agree but.. if change at POTUS i think anything poss. Just imagine Hester Peirce (or someone like that) running the SEC..
— Eric Balchunas (@EricBalchunas) June 27, 2024
James Seyffart, another Bloomberg analyst, predicted a 2025 launch for spot SOL ETFs "if we have a new admin in the White House and SEC." He reiterated that the projection is still not a guarantee.
Finance lawyer Scott Johnson said the VanEck filing could be a "bigger election outcome catalyst" and from the early looks of it, the Solana blockchain's rise at this point is "not great for [incumbent President Joe] Biden at the margins."
VanEck's filing comes as the crypto community waits on the SEC's decision regarding the complete approval of spot Ethereum ETFs. Gensler has said it may be fully approved for trading by summer 2024.
