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Solana ETF Approval Stands Strong: VanEck Exec

Published

2 months ago

July 10, 2024

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In a recent interview transcript with Matthew Sigel, a VanEck’s Head of Digital Assets Research, he expressed confidence in the prospects of a Solana Exchange-Traded Fund (ETF). He believes that Solana ETF approval stands strong despite challenges posed by the absence of a regulated futures market. Sigel highlighted that while conventional wisdom often ties ETF viability to the existence of a robust futures market, sectors such as uranium and others have demonstrated that this correlation does not always dictate market success.

Solana ETF Approval Imminent

In a recent YouTube interview, Sigel pointed out that VanEck’s approach to launching a Solana ETF hinges on a deep dive into the decentralization and utility characteristics of the Solana blockchain. He noted, “When we examined the language around decentralization and characteristics of the blockchain… the ETH and SOL assets at this point are fundamentally the same.”

Moreover, VanEck believes that Solana’s decentralized nature and its utility as a commodity qualify it for consideration as an ETF asset. This is largely due to its role in providing access to a substantial open-source App Store. Despite the current regulatory landscape in the United States, where a significant futures market is typically seen as essential for ETF approval, Sigel expressed optimism.

He acknowledged the regulatory focus on a sizable, regulated futures market for transparency and price formation. On the flip side, the VanEck exec asserted, “We think this can get done but probably might need a different SEC chair.” Furthermore, Sigel highlighted VanEck’s international experience with Solana ETFs.

He spotlighted their successful deployment in Europe for nearly three years. This operational history positions VanEck advantageously as it has navigated regulatory hurdles and market dynamics for innovative financial products.

Additionally, the discussion also touched on the Canadian market, where 3iQ, another prominent financial player, has filed for a Solana Fund. Meanwhile, VanEck has faced competition from 21Shares as the firm also filed for a SOL. These firms recently submitted the 19-b4 filings for their Solana ETFs. Furthermore, Bloomberg’s ETF analyst, Eric Balchunas, has provided a mid-March 2025 deadline for these ETFs.

VanEck Exec Elucidates On SEC, Bitcoin & Ethereum ETFs

In addition, Sigel also reflected on the impressive performance and investor reception of Spot Bitcoin ETFs. He stated, “To have $16 billion in these products after six months… alerted the world that this asset class is here to stay.” He also underscored the role of institutional investors in early adoption.

Sigel highlighted hedge funds’ proactive stance compared to traditional advisors, foreshadowing broader market participation. Regarding Ethereum ETFs, Sigel acknowledged regulatory progress. He noted, “Gary Gensler described the Ethereum ETF process as running smoothly,” signaling potential approval pathways under Gensler’s leadership.

He tempered expectations, however, citing challenges such as the absence of staking rewards in US products. This could impact attractiveness relative to global counterparts. Sigel’s comments on SEC regulation under Gensler provided nuanced perspectives.

He critiqued regulatory inconsistencies, citing court rulings favoring decentralization in cases involving Ripple and Binance against SEC allegations. Sigel opined, “Federal judges ruling that secondary sales of assets like XRP or BNB are not securities transactions… are very positive for the Coinbase suit.”

In addition, Sigel believes that the necessity of a futures market for spot Ethereum, Solana and other crypto ETF approval is SEC Chair Gary Gensler’s “side out.” Moreover, he also highlighted the need for a new SEC Chair for better regulatory clarity