- The SEC’s approval of Solana ETFs could happen within two weeks, fueled by the inclusion of staking provisions in the filings.
- The recent amendments allow ETFs to generate yield from Solana’s proof-of-stake mechanism, boosting their attractiveness to investors.
- Institutional demand for Solana products, like Bitwise’s European staking ETP, has surged, increasing pressure for approval.
Several major issuers have submitted amended S-1 filings to the U.S. Securities and Exchange Commission (SEC) for Solana ETFs, drawing significant attention from industry experts. Companies such as Grayscale, Fidelity, Bitwise, and CoinShares have included provisions for staking, signaling an evolving landscape for cryptocurrency exchange-traded funds. The recent amendments aim to incorporate Solana’s proof-of-stake mechanism, which would enable ETFs to earn additional yield through staking their Solana holdings.
ETF analyst Nate Geraci suggests that these filings could receive SEC approval as soon as two weeks from now. This expectation aligns with the SEC’s increasingly efficient processing of digital asset products, making approval timelines shorter. Consequently, the inclusion of staking provisions could make Solana ETFs more attractive to institutional investors by offering an income stream in addition to price exposure to Solana.
Growing Appeal of Staking Features in ETFs
Staking provisions in these filings allow the funds to earn rewards, either in SOL tokens or cash, from Solana’s proof-of-stake mechanism. As a result, these rewards are treated as income for the fund and could boost the net asset value (NAV). With the potential to offer both yield and price exposure to Solana, these ETFs become an appealing option for investors seeking diversified income streams.
Firms like Grayscale, Bitwise, and Canary have emphasized that their trusts will direct Solana holdings into staking accounts, making it easier for investors to benefit from this additional income. This innovation further enhances the appeal of Solana ETFs, especially at a time when investor demand for Solana-related products is on the rise globally.
Institutional Demand and Market Impact
The surge in institutional interest in Solana-related products has contributed to the momentum behind these filings. Bitwise’s European Solana staking ETP recently saw $60 million in inflows within a single week, underscoring the growing demand for Solana-based financial products. Additionally, the REX-Osprey Solana ETF has been drawing consistent investment in the U.S., with $10.6 million in net inflows recorded in just one day. The ETF now has over $250 million in assets under management, further highlighting the strong demand for Solana exposure.
Moreover, the restructuring of the REX-Osprey ETF, converting it from a C-Corporation to a regulated investment company, may improve its tax efficiency. This could make the product even more appealing to investors in the long run.
As the SEC continues to adjust its stance on cryptocurrency products, these Solana ETFs could be among the first to receive approval under the new regulatory framework. The speed of approval, possibly within the first two weeks of October, would mark a significant step for Solana’s integration into mainstream financial markets.
