Key facts:
- VanEck and 21Shares have filed to launch a solana (SOL) ETF.
- For the SEC, Solana Asset is a security and should be regulated.
At the end of June 2024, the US Securities and Exchange Commission (SEC) received applications to launch solana (SOL)-based exchange-traded funds (ETFs). So far, the companies that have submitted these forms are the asset management firms VanEck and 21Shares.
For its part, the Chicago Board of Trade (CBOE) requested authorization from the SEC to list the ETFs, through 19b-4 filings. These documents are important since they set a 240-day window for the regulatory body led by Gary Gensler to provide a response.
In a recent interview with news site Coinage, SEC Commissioner Hester Peirce was asked about the issue and explained that they are looking into these filings although she was not optimistic about the future. She said:
“We really have to look at each case individually. In this cryptocurrency environment it is very difficult, of course, because there are questions about what my colleagues and I are going to consider a security and what we are not. There are all kinds of questions.”Hester Peirce, US SEC Commissioner.
As CriptoNoticias reported, Peirce is known in the industry as “Crypto Mom” and is a Republican Party commissioner within the organization, which is, an opponent of the direction led by Gary Gensler. In fact, on more than one occasion she expressed her disagreement with the SEC’s position regarding bitcoin (BTC) and cryptocurrencies.
With these statements, Peirce not only casts doubt on the possibility of a SOL ETF in the short term, but also expresses his doubts regarding which asset should be considered a security and which should not.
In its legal filing against Binance, the SEC stressed that the Solana network altcoin is an unregistered security and therefore must be regulated. The agency also argued that there is evidence that SOL is a “share” of Solana Labs, the organization that builds products and tools to expand the ecosystem of that network. “Since initial sales in September 2020, SOL is reasonably viewed as an investment and holders expect to benefit from Solana Labs’ efforts to grow the Solana protocol, which in turn would increase demand for and value of SOL,” the filing clarifies.
On the other hand, Peirce mentioned that it is “necessary to look and see if there have been other types of markets or other types of products where there has not been an underlying futures market, and then you can make the case based on that.”
In this case, “Crypto Mom” refers to the fact that both BTC and ether (ETH), the digital currency of the Ethereum ecosystem , had a futures market on the Chicago Mercantile Exchange (CME). This served as proof to show that the trading history was not manipulated by the market.
In the case of SOL, there is still no similar market and this could be an obstacle for VanEck and 21Shares to get the approval they need to launch their ETFs for this asset. “We should really take the existing precedent and apply it to the facts and circumstances that are the case,” he repeated.
For Eric Balchunas, market analyst at Bloomberg Intelligence, there is one factor that could be decisive for the future of solana ETFs: the elections in the United States. Although Joe Biden declined the possibility of running for reelection, the Republican Party candidate maintains his chances of returning to the White House. “If Trump wins, anything is possible,” Balchunas had declared.
For his part, Matthew Sigel, head of digital asset research at VanEck, said that SOL ETFs could be approved “but with a different president at the SEC.”
