SEC reportedly fast-tracks Solana ETFs: potential approval arrives within 5 weeks

The US Securities and Exchange Commission (SEC) asked would-be Solana exchange-traded fund (ETF) sponsors to file amended S-1 Forms within a week, Blockworks reported on June 10, citing three people familiar with the discussions.

The sources said that the SEC has informed the issuers that it intends to respond within 30 days of the filings. Additionally, staff directed applicants to clarify procedures for in-kind redemptions and describe how funds might participate in Solana staking. 

Two of the sources added that regulators seemed open to allowing limited staking inside the product structure. One participant estimated that if the revised filings are received this week, a decision could be made in three to five weeks.

Approval within the next month

Bloomberg ETF analysts James Seyffart and Eric Balchunas predicted in April that the approval of altcoin-related funds might not happen before October when most of the final deadlines for a SEC decision expire.

Seyffart reiterated on May 20 that the SEC usually takes full time to respond to 19b-4 filings. However, if an early approval occurs, it might not happen until the first days of July.

Balchunas shared a note by Seyffart on June 10, reinforcing that “ETFs that track broad crypto indexes may be approved by the SEC within the next month.”

Balchunas added that the recent filing of REX Shares to list Ethereum and Solana ETFs with staking offerings was the reason the regulator is considering fast-tracking the approvals.

The filings used the rare “C-Corp” format, which has a shorter response deadline with the regulator. 

Competitive slate lines up

Fidelity, Franklin Templeton, VanEck, Bitwise, Canary Capital, 21Shares, and Grayscale all have applications for a Solana ETF.

Grayscale seeks to convert its existing Solana Trust into an ETF, mirroring the path it used to list spot Bitcoin and Ethereum funds. The firm’s was delayed on May 13, while Franklin Templeton’s proposal was delayed on April 30. Meanwhile, filings submitted by Fidelity and VanEck were postponed on May 19.

On June 6, VanEck, Canary, and 21shares sent a letter to the SEC asking for the reinstatement of the first-to-file approval order. 

The ETF issuers claimed concurrent approvals strip early filers of the advantage that traditionally offsets higher legal and compliance costs. In the letter, they mentioned Solana ETFs.

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