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Sujit Kumar
May 23, 2024

Solana as Next Spot ETF Contender Faces SEC Hurdles, Says Experts

Next Spot ETF Contender
Crypto investor and CNBC ‘Fast Money’ trader Brian Kelly ignited discussions by suggesting Solana (SOL) could be the next cryptocurrency to secure a spot exchange-traded fund (ETF) in the United States. Kelly made this prediction on CNBC's Fast Money, speculating that Solana could join Bitcoin and Ethereum as major digital assets in the ETF market.

Industry Opinions on Solana ETF

However, this prediction was met with skepticism from some industry experts. Nate Geraci, president of The ETF Store, argues that a spot Solana ETF is unlikely until Solana futures are traded on the Chicago Mercantile Exchange or a comprehensive cryptocurrency regulatory framework is established. So far, only Bitcoin and Ether futures have received approval in the U.S.

Bloomberg ETF analyst James Seyffart echoed Geraci’s sentiment, noting that such a development would follow the establishment of a Commodity Futures Trading Commission-regulated market, likely within a few years. Seyffart believes a spot Solana ETF would attract significant demand, second only to Bitcoin and Ether.

Regulatory Hurdles and SEC Scrutiny

Despite the interest, Seyffart highlighted regulatory challenges, noting that the SEC has previously identified Solana as a security in lawsuits against Coinbase and Kraken. This designation could complicate the approval process for a spot Solana ETF.

Cinneamhain Ventures partner Adam Cochran offered a different perspective, suggesting that Litecoin (LTC) or Dogecoin (DOGE) might be more likely candidates for the next spot ETF due to their proof-of-work consensus mechanisms, which align more closely with regulatory expectations.

Market Interest and Future Prospects

Few ETF issuers have openly discussed filing for a spot Solana ETF. Nonetheless, Franklin Templeton, a trillion-dollar asset management firm, recently praised Solana and its co-founder Anatoly Yakovenko, fueling speculation about potential future filings.

Bitwise’s chief investment officer, Matt Hougan, also expressed optimism about Solana, predicting it could be the "crypto asset of 2024" and exploring its real-world use cases that could attract institutional interest.

Conclusion

While the potential for a spot Solana ETF sparks debate, significant regulatory hurdles remain. The path forward will depend on SEC decisions and broader market developments.

Disclaimer: The views and opinions expressed in this article are for informational purposes only and do not constitute financial, investment, or other advice. Investing in or trading crypto assets comes with a risk of financial loss.
Solana as Next Spot ETF Contender Faces SEC Hurdles, Says Experts
Sujit received his Bachelors in Science from the LNMU Darbhanga. He is currently working as a Content Strategist. He has more than three years of professional experience in information systems, security policies, technologies, and Cryptocurrency. He has published 6 books in the area of information security and assurance. He has published more than 50 research articles in leading journals Regarding the Latest and Breaking Crypto News and updates. His research interests include access control, computer forensics, Digital Marketing, Web development, business hacks, player experience, and virtual storytelling.

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