The SEC reviews multiple crypto ETF proposals that could reshape digital asset investing on Wall Street. The regulator now invites public comment on 4 Solana ETF proposals filed on Tuesday, February 4, 2025. Grayscale submitted its Solana ETF application on Monday, January 28, 2025 and also filed a Cardano ETF proposal on Monday, February 10, 2025. These moves follow the SEC approval of a Bitcoin ETF on Wednesday, January 10, 2024 and signal a major policy shift. This shift opens the door for regulated digital asset funds that may see inflows of $100M or more. The proposals target tokens with high utility and clear market value such as Solana and Cardano. The SEC now tests a new framework for crypto products that could lower costs and provide transparency for retail and institutional investors alike. Fund issuers rush to seize crypto opportunities. Furthermore, a regulatory giant like the SEC approving more crypto ETFs may reshape crypto investing on Wall Street and also finance in the U.S. and globally as crypto becomes more widely accepted.
Quick Takes
-
4 Solana ETF proposals were submitted on Tuesday, February 4, 2025
-
Grayscale submitted its Solana ETF application on Monday, January 28, 2025
-
Grayscale filed its Cardano ETF proposal on Monday, February 10, 2025 triggering a 21-day review period
What Are Crypto ETFs and Why Are They Important?
Crypto ETFs are exchange traded funds that track digital assets or baskets of cryptocurrencies. An Exchange-Traded Fund (ETF) is a type of investment fund traded on stock exchanges, like stocks. It combines the diversification of mutual funds with the lower costs, liquidity, and tax efficiency of stocks. The first ETF appeared in Canada in 1990, and the concept expanded to the U.S. in 1993 with the SPDR S&P 500 ETF. Gold ETFs, such as the SPDR Gold Shares launched in 2004, offer accessible gold investment and can influence gold prices. Similarly, introducing a Bitcoin ETF could significantly impact the cryptocurrency market by enhancing accessibility, liquidity, and investor interest.
BTC vs. Gold price performance overtime. Source: NewHedge
ETFs let investors access crypto markets through traditional stock exchanges. Crypto ETFs offer regulated exposure to digital assets and lower costs. They simplify portfolio integration and provide liquidity and transparency. Retail and institutional investors gain access to diversified crypto assets with less complexity. This new investment vehicle may attract significant capital and spur further innovation in the crypto market.
Gold saw record demand in 2024. Source: World Gold Council
Read more: What Is a Bitcoin ETF? Everything You Need to Know
Why a Solana ETF?
Source: KuCoin
Solana (SOL) has emerged as a standout performer in 2024, gaining recognition for its scalability, low transaction costs, and high-speed performance. Often referred to as an “Ethereum killer,” Solana has rapidly expanded its ecosystem over the past year, encompassing a thriving decentralized finance (DeFi) sector, booming NFT projects, and a growing memecoin market.
A Solana ETF is a proposed investment fund designed to track the performance of Solana’s native cryptocurrency, SOL. It would let you invest in SOL through traditional brokerage accounts, removing the technical complexities of managing crypto wallets and private keys. By buying shares of a Solana ETF, you gain exposure to Solana’s price movements in a secure and regulated manner.
Read More: What is a Solana ETF and How does it work?
SEC Weighs 4 New Solana ETF Applications
The SEC now reviews 4 Solana ETF proposals. Canary Capital launched its Solana Trust on Tuesday, February 4, 2025. VanEck filed its application on Tuesday, February 4, 2025. 21Shares and Bitwise joined the filing on Tuesday, February 4, 2025. The regulator opens a 21-day public comment period on these proposals. This process tests a new approach to crypto funds and signals a willingness to explore innovative investment vehicles.
"The SEC has done a big about-turn on the Solana ETF—from refusing to even entertain such an investment product to acknowledging Grayscale's amended SOL ETF application," Chris Chung, founder of Solana swap platform Titan
Read more: What Is a Solana ETF, and How Does It Work?
Grayscale Moves for a Cardano ETF
Source: KuCoin
Grayscale seeks a Cardano ETF on the NYSE. NYSE Arca submitted a 19b-4 form on Monday, February 10, 2025 on behalf of Grayscale. Cardano ranks as the 9th largest cryptocurrency by market capitalization. Its price reached $0.748 on Monday, February 10, 2025 after the news broke. The filing triggers a 21-day review period during which the SEC must decide on the proposal by Monday, March 3, 2025. This move builds on additional filings for XRP and Dogecoin funds and expands the crypto ETF landscape.
Read more: Grayscale’s Cardano ETF Sparks 15% Surge: A Bullish Signal for ADA
Crypto ETF Policy Shift
The SEC signals a shift in crypto ETF policy. Under former SEC Chair Gary Gensler the agency approved only Bitcoin and Ethereum ETFs. Today, asset managers pursue ETFs for XRP Litecoin Dogecoin and Solana. The regulator acknowledged a spot Solana ETF application on Thursday, February 6, 2025. This action may alter the framework for crypto products. The new U.S. administration supports these changes with a dedicated crypto task force led by Commissioner Hester Peirce. Next the SEC will evaluate each proposal with rigorous scrutiny and technical precision.
Industry Impact and Expert Views
Industry experts predict a surge of crypto ETFs this year. Chris Chung of Titan said the SEC has done a big about-turn on the Solana ETF. He compared this moment to Wednesday, January 10, 2024 when the SEC approved a Bitcoin ETF. Steven McClurg of Canary Capital said his firm targets tokens with clear utility. His firm favors Solana, XRP, Litecoin and HBAR. They avoid meme coins such as Dogecoin. However, previous comments from Canary Capital CEO Steven McClurg reveal a more nuanced strategy behind his company's ETF pursuits.
"It's like, 'Hey, well, if we're doing these other ones, we might as well jump in and get in on the action if something happens,” McClurg speaking about his company's SOL ETF filing.
Experts believe that approval of a Solana ETF may position Solana as the blockchain for mass adoption. The market now watches closely for further developments and investor interest.
Conclusion
The SEC review marks a turning point for crypto investing on Wall Street and finance globally. Crypto ETFs play a significant role in the financial landscape. They offer a more streamlined and secure way for investors to access the cryptocurrency market, which is particularly important given the market's volatility and the evolving regulatory environment. The regulator giant SEC invites public comment on 4 Solana ETF proposals filed on Tuesday, February 4, 2025. Grayscale submitted its Solana ETF application on Monday, January 28, 2025. Grayscale also filed its Cardano ETF proposal on Monday, February 10, 2025. Experts predict a wave of crypto ETFs beyond Bitcoin and Ethereum. Approval of these funds may spur mass adoption of digital assets and unlock new investment opportunities. The coming weeks will reveal the impact of these decisions on the market.
