VanEck’s Head of Digital Assets Research, Matthew Sigel, has confirmed speculation that their Solana spot ETF proposal is influenced by the outcome of the US Presidential elections. The deadline for the application is March 2025, well past the elections in November. Sigel has indicated that the approval odds for the ETF are slim if Joe Biden remains in office but are better if Donald Trump wins. Trump’s potential appointment of a new SEC chair could impact the approval process significantly.
A major obstacle to the potential approval of the Solana ETF is the absence of a futures market on CME, a key factor that benefitted spot Bitcoin and Ethereum ETFs in gaining regulatory approval. Grayscale has argued that surveillance sharing agreements similar to those in place for CME Bitcoin futures could be replicated for spot ETFs. The disagreement with the SEC over the necessity of such agreements for spot Bitcoin ETFs has been a central point in the approval process.
Since the SEC has recently approved spot ETFs for Bitcoin and Ethereum, Sigel believes that VanEck may not need to establish a CME futures market for the Solana ETF. He believes that surveillance sharing agreements with spot crypto exchanges could suffice. Bloomberg analysts agree that these agreements should be adequate, but they caution that new leadership at the SEC or Congressional action may be necessary for approval.
Despite past ETF filings including surveillance sharing agreements with exchanges like Coinbase, these agreements have not always been essential for approval. The ongoing securities lawsuits against exchanges such as Coinbase and Kraken by the SEC further complicate the process, making it uncertain whether similar agreements will be sufficient for the Solana ETF proposal. The complex nature of regulatory oversight and the changing landscape of digital assets make the outcome of the Solana spot ETF proposal uncertain.
The success of VanEck’s Solana spot ETF proposal hinges on numerous factors, including the political landscape, regulatory requirements, and the evolving nature of the cryptocurrency market. The road to approval is fraught with challenges and uncertainties, making it difficult to predict the outcome with certainty. Only time will tell whether the Solana ETF will see the light of day in the competitive world of digital asset investments.