The long-awaited approval of an Ethereum spot exchange-traded fund (ETF) within the US appears imminent, and trade insiders are already wanting forward. Solana, a high-speed blockchain community, is rising as a possible favourite for the following cryptocurrency ETF.
Brian Kelly, founder and CEO of BKCM LLC, believes Solana is a powerful ETF contender as a result of its rising recognition and potential to be a part of the “massive three” alongside Bitcoin and Ethereum within the present crypto market cycle.
This sentiment coincides with the latest surge in anticipation round Ethereum ETFs. A latest shift within the Securities and Trade Fee’s (SEC) stance, evident in its last-minute approval of bitcoin futures ETFs in January, has fueled optimism for Ethereum and presumably different cryptocurrencies.
Thought of by CNBC Visitor $Sol will obtain the Subsequent Spot ETF 🤯 pic.twitter.com/M79fSC6uJy
— Joshua Jake (@itzjoshuajake) May 22, 2024
Traders’ curiosity: Unsure quantity
Nevertheless, not everybody within the trade agreed with Kelly’s prediction.
Based on Nate Geraci, president of The ETF Retailer, Solana’s spot ETF won’t be accessible till Congress establishes a legislative framework to control cryptocurrencies or till Solana’s CME-traded futures product is listed.
No sol ETF till CME-traded sol futures seem or Congress enacts a authorized regulatory framework for crypto….
Crypto ETF faucet is off for some time after spot eth ETF is accepted… IMO. https://t.co/6CwP8UcOj4
— Nate Geraci (@NateGeraci) May 22, 2024
Presently, solely Bitcoin (BTC) and Ether (ETH) futures are allowed in the USA.
For his half, analyst Robert Mitchnick of Blackrock, a number one funding administration agency, pours a bucket of chilly water on the altcoin ETF social gathering.
Mitchnick’s conversations with shoppers, primarily based on the report, present “little curiosity” in altcoins like Ethereum, not to mention lesser-known gamers. This implies that even when the SEC greenlights ETFs, widespread investor adoption could also be gradual.
SOL market cap nearing the $80 billion degree. Chart: TradingView.com
Curiously, Europe appears to be forward of the curve in relation to Solana. There are already a number of exchange-traded merchandise (ETPs) there, highlighting a possible hole within the US market that the Solana ETF may fill.
Authorized standing: a possible impediment
Whereas trade insiders like Kelly are optimistic, a big hurdle stands in the way in which of the Solana ETF: its authorized classification. SEC lawsuits in opposition to cryptocurrency exchanges Coinbase and Binance in 2023 referred to as Solana a safety, not a commodity.
This distinction is essential as a result of ETFs historically cope with commodities, not securities. Solana’s basis strongly disputes the SEC’s claims, emphasizing the decentralized nature of its blockchain community. Nevertheless, authorized ambiguity can result in a prolonged approval course of and even denial by the SEC.
Solana: The highway forward
The success of the Ethereum ETF, if accepted, is prone to paved the way for future cryptocurrency ETFs, together with SOL. Moreover, the SEC’s place on Solana’s authorized standing requires clarification earlier than concrete progress might be made.
Featured picture from OKX, chart from TradingView
