VanEck filed an S-1 document with the U.S. Securities and Exchange Commission (SEC) to create a Solana cash ETF. How does the crypto community react?
The document says VanEck's Solana ETF is called VanEck Solana Trust. If approved, the product will be marketed on the Cboe BZX platform. The fund does not contemplate participation in SOL: all shares of the fund will be sold and exchanged for cash only.
VanEck is one of the first US asset managers to offer investors access to international markets, investments in gold, emerging markets and ETFs. VanEck is one of the companies that has launched a bitcoin ETF and hopes to launch its own ETF for ethereum. However, the firm's ETF filing for Solana is the company's first and only one.
Why the Solana ETF?
VanEck's head of digital asset research, Matthew Sigel, explained why the firm decided to launch a Solana ETF. First of all, he highlighted scalability, high speed and low fees, which offer enormous potential for a better user experience.
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“We believe that the native token, SOL, functions similarly to other digital products such as bitcoin and eth. It is used to pay transaction fees and computational services on the blockchain.”
Matthew Siegel, head of digital asset research at VanEck
He added that due to its high usefulness, VanEck is confident that SOL will be useful to a wide audience, including investors, developers and even ordinary entrepreneurs looking for an alternative to diversify their portfolios.
“The wide range of applications and services supported by the Solana ecosystem, from decentralized finance (DeFi) to non-fungible tokens (nft), underlines the usefulness and value of SOL as a digital product.”
Matthew Siegel, Director of Digital Asset Research at VanEck
Matthew Siegel, director of digital asset research at VanEck
Another player in the ETF field
VanEck has jumped into the race to launch a Solana spot ETF amid anticipation of the launch of a similar fund for ethereum. According to preliminary estimates, investors could have access to it in July.
Amid the approval of the launch of the ethereum spot ETF, the SEC has withdrawn its claims against the project.
VanEck is confident that SOL does not violate U.S. securities laws. Therefore, according to the authors, the SEC has no reason to refuse to launch the Solana spot ETF.
At the same time, GSR Markets Analysts are confident that the Solana spot ETF will absorb 2% and 5% of bitcoin funds in the bear market and baseline scenarios, respectively. This will increase Solana’s price by 1.4x and 3.4x. The report claims that Solana’s growth potential is significant, with potential for substantial market value and price increases.
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“While a Solana spot ETF could see inflows as a percentage of bitcoin of 2%, 5%, or 14% in a bearish, baseline, and blue sky scenario, respectively, we must now adjust for the impact a spot ETF may have on SOL. Because of its smaller size, we use market cap. Specifically, Solana’s market cap has averaged just 4% of bitcoin’s over the past year.”
GSR Markets Analysts
How do the experts react?
Bloomberg analyst Eric Balchunas says the chances of launching a spot Solana ETF may decrease because the list of investment instruments on SOL is lower than that of ethereum.
However, a change of US president could lead to the liberalisation of the crypto industry. Therefore, Solana ETFs will probably not be approved until 2025.
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FOX reporter Eleanor Terrett reminded us that SOL is not yet traded on a regulated futures exchange, unlike btc and eth, so approval is still a ways off. However, VanEck can claim to be the first to file for the first Solana ETF in the United States.
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Venture capitalist Anthony Pompliano called VanEck's filing further evidence that altcoins are coming to Wall Street. Analyst Lark Davis x.com/TheCryptoLark/status/1806337963892060584″ target=”_blank” rel=””>He also has confidence that the long-awaited bull run will emerge amid the race to launch new spot altcoin ETFs.
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Will Solana ETFs be approved?
The cryptocurrency market is awaiting a decision on ethereum spot ETFs. Negotiations between asset managers and regulators are now entering their final stages.
However, things are more complicated in the case of the Solana ETF. Since there are no futures ETFs for Solana in the US, unlike bitcoin and ethereum, futures products based on these cryptoassets appeared before spot ETFs. This approach is explained by the SEC's concerns about possible fraud and market manipulation.
As a result, the Solana-based spot ETF faces a more difficult road before being admitted to the market.
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