The US Securities and Exchange Commission (SEC) has requested potential Solana exchange-traded fund (ETF) sponsors to submit amended S-1 Forms within a week, as reported by Blockworks on June 10. According to sources familiar with the discussions, the SEC aims to respond within 30 days of the revised filings. The regulators have asked applicants to clarify procedures for in-kind redemptions and outline how funds can participate in Solana staking.
There is a possibility of limited staking being allowed within the product structure, with a decision expected within three to five weeks if the revised filings are submitted promptly. Bloomberg ETF analysts James Seyffart and Eric Balchunas previously predicted that approval for altcoin-related funds may not occur until October, given the usual timeframe for SEC responses to 19b-4 filings. However, there is a chance of early approval by the first days of July.
Balchunas highlighted a note by Seyffart on June 10, suggesting that ETFs tracking broad crypto indexes, including Solana ETFs, may receive approval from the SEC within the next month. The recent filing by REX Shares to list Ethereum and Solana ETFs with staking offerings has prompted the regulator to consider expediting the approval process, particularly as the filings were in the “C-Corp” format with shorter response deadlines.
Several prominent financial institutions, including Fidelity, Franklin Templeton, VanEck, Bitwise, Canary Capital, 21Shares, and Grayscale, have submitted applications for a Solana ETF. Grayscale is looking to convert its existing Solana Trust into an ETF, similar to its listing of spot Bitcoin and Ethereum funds. However, delays have been experienced by some applicants, such as Franklin Templeton and Fidelity, while VanEck, Canary, and 21Shares have requested the reinstatement of the first-to-file approval order in a joint letter to the SEC.
The letter highlighted concerns that concurrent approvals could disadvantage early filers who typically bear higher legal and compliance costs. The ETF issuers specifically mentioned Solana ETFs in their communication with the SEC. Overall, the landscape for Solana ETFs is competitive, with multiple players vying for approval and positioning themselves to capitalize on the growing interest in digital asset investments.