- The SEC’s classification of Solana as a security has halted the Solana ETF application process. CBOE decided to withdraw the 19b-4 form to avoid regulatory scrutiny.
- SOL’s close ties to Solana Labs and its classification as security present significant challenges for ETF approval.
- While other crypto ETFs gain traction, SOL ETF approval is unlikely before 2025 due to regulatory complexities.
Solana ETF hopes were dashed after the U.S. SEC held a closed-door meeting with ETF issuers about whether the token might be classified as a security. Following discussions, CBOE decided not to submit the relevant 19b-4 form to avoid initiating the approval process. While VanEck’s S-1 registration statement for the Solana ETF is still on display, 21Shares’ has been withdrawn.
Forms 19b-4 for VanEck and 21Shares Solana ETFs appear to have been removed from the CBOE website. Documents SR-CboeBZX-2024-066 & SR-CboeBZX-2024-067 aren’t accessible anymore via direct link, and are no longer visible in BZX Pending Rule Changes. Another interesting thing is that both applications were filed on July 8, but SEC never issued Notices of Filing for them. My question is, does it mean that 19b-4s were withdrawn?
VanEck and 21Shares filed Form 19b-4 applications for Solana ETFs with the CBOE on July 8, 2024. These filings, referenced as SR-CboeBZX-2024-066 and SR-CboeBZX-2024-067, appeared to have been removed from the CBOE website. Moreover, the SEC has not issued notices of filing for these applications. The disappearance of these filings coupled with the regulator’s lack of action raises questions about the status of these Solana ETF applications.
Things became clearer when industry insiders confirmed that the SEC and CBOE have collectively decided not to go ahead with the 19b-4 forms. Filing these forms with the Federal Register would have put the onus on the regulator to make decisions relating to the prospective Solana ETFs.
Solana ETFs Unlikely Until 2025
Following Ethereum ETF approval, crypto enthusiasts were considering the possibility of a spot in the SOL ETF. However, the SEC’s stance was not surprising given that the agency had previously called the token security in multiple court filings, the source said. Critics also argued that SOL is too closely tied to Solana Labs, leading regulators to perceive it more as a security or stock than a commodity asset. This presents a significant obstacle, with legal cases in progress.
Although other cryptocurrencies like Bitcoin and Ethereum have approved ETFs, the likelihood of SOL ETFs being approved under the current administration is low, with experts suggesting it might not happen until 2025, if at all.
Amidst the regulatory uncertainty surrounding spot crypto ETFs, head of Digital Asset Research at VanEck remains bullish on SOL ETF despite CBOE removing its 19b-4 filing.
