The prospect of a Solana (SOL) based exchange-traded fund (ETF) receiving approval in 2024 is fading, according to Eric Balchunas, a Senior ETF Analyst at Bloomberg. Balchunas believes that without a shift in regulatory leadership, the chances of such an approval are minimal. He stated, “There’s a snowball’s chance in hell of approval unless there’s a change in leadership,” emphasizing the challenging regulatory landscape for crypto-based ETFs.
This pessimistic outlook is reinforced by actions from the U.S. Securities and Exchange Commission (SEC). The SEC has rejected Cboe BZX’s 19b-4 filings for two prospective spot Solana ETFs, leading to their withdrawal from the Cboe website. This decision, following discussions between the SEC and issuers, stemmed from concerns about classifying Solana as a security. Data from Polymarket, a decentralized information markets platform, reveals that the probability of a Solana ETF approval in 2024 is currently a mere 6%. This represents a decline from the 12% chance when VanEck applied for a Solana ETF in late June.
The approval process for crypto ETFs is complex and involves multiple stages. Exchanges initiate the process by filing initial 19b-4 forms with the SEC, followed by posting and review stages. In the case of the Solana ETF, the Chicago Board Options Exchange (CBOE) filed its 19b-4 form on July 8. However, the SEC’s failure to post this filing on its website suggests potential regulatory hesitation. The timeline for ETF approval decisions includes several deadlines, allowing the SEC to delay, deny, or approve at different stages. The first deadline typically falls around day 65 after the initial filing, with subsequent deadlines at approximately 110, 200, and 260 days. The lack of progress in the Solana ETF’s case indicates significant hurdles in meeting these deadlines.
As the cryptocurrency community navigates these regulatory challenges, the upcoming Benzinga Future of Digital Assets event on November 19 will provide a critical platform for discussion and analysis of the evolving landscape.
