After Ethereum’s success in securing its first ETF in the U.S., the momentum seems to be spreading to other cryptocurrencies. The possibility of more digital assets gaining approval has excited the crypto sector, though challenges remain.
Brazil recently gave the green light for its first Solana ETF, marking a key moment for the cryptocurrency. Solana, created in 2017, is aiming to join Bitcoin and Ethereum in the ETF space. This is a big win for Solana as it continues to grow in popularity, thanks to its fast transactions and low fees.
Push for Solana ETF Gains Traction
Solana, developed by Anatoly Yakovenko, has grown significantly since its inception. Backed by the Solana Foundation, the cryptocurrency now has a market cap of $70 billion, making it one of the largest globally. Brazil’s approval of a Solana ETF could bring substantial investment into the network, especially in Latin America.
Several institutions are already making moves to introduce Solana ETFs to global markets. In June, VanEck, a major player in the crypto investment world, submitted a request for a Solana ETF. Other companies, like 21Shares and Cboe Global Markets, quickly followed with their own applications.
Challenges in the U.S. Market
Despite these advancements, securing approval from the SEC remains a significant hurdle. Katalin Tischhauser, head of investment research at Sygnum Bank, noted that Solana lacks the regulated trading venues needed for U.S. market surveillance. Unlike Bitcoin and Ethereum, which had CME futures trading during their ETF approval process, Solana’s current exchanges fall short of the SEC’s requirements.
Concerns about market manipulation and Solana’s history of network outages add to the uncertainty. The SEC is cautious, and Solana’s reliability and stability are key issues they will examine.
Solana’s limited name recognition outside of the crypto world also presents a challenge. While Bitcoin and Ethereum are widely known, other digital assets, like Solana, have a smaller following in traditional finance.
Future Outlook
The Biden administration’s current stance on crypto regulation further complicates matters. Many analysts believe Solana’s chances of receiving ETF approval in the U.S. are slim. However, this could change if a different administration takes over. Former President Donald Trump, leading in the polls, has positioned himself as a “crypto president” and could influence a shift in crypto regulations if elected.
The process for Bitcoin’s ETF approval took years and involved a legal battle with the SEC. Under current rules, the SEC has 240 days to decide on any new ETF requests. Solana’s path to approval will require a combination of market readiness, regulatory changes, and political support to align at the right time.
The road ahead may not be easy, but Solana is poised to push forward in its quest for ETF approval.
