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- People are talking about Solana as a quicker, cheaper Ethereum alternative, and there’s a lot of rumors about a potential ETF for it.
- The SEC has to decide by March if they’ll approve a Solana ETF, especially after greenlighting ether ETFs.
- Solana has become a hotspot for meme tokens and serious stuff like tokenizing assets, despite its rocky past.
Probably the most-talked about things in the crypto industry right now are exchange-traded funds (ETFs). With spot Ether ETFs hitting the U.S. markets, everyone’s asking: “What’s the next big crypto to get its own ETF?”
The buzzword? Solana. This cryptocurrency is known for being a speedy and cost-effective rival to Ethereum, capable of handling large transaction volumes like those in traditional finance.
Recently, Franklin Templeton called SOL one of the “exciting and major developments that we believe will drive the crypto space forward.” The token has a market cap of $82 billion, making it the fifth-largest cryptocurrency.
Solana’s reputation has improved dramatically from two years ago, when it was plagued by frequent outages and linked to Sam Bankman-Fried. Now, it’s drawing interest from different crowds.
All eyes on Solana
Solana is now the go-to platform for launching meme tokens. These quirky cryptoassets are often based on internet memes or parodies of public figures.
For instance, tokens related to Kamala Harris and Joe Biden have seen a lot of trading action following the latter vacating the Democratic ticket for the former. Solana’s blockchain can handle these high volumes efficiently.
But it’s not all fun and games. SOL is also being used for serious financial activities, like tokenizing real-world assets. Just this week, Hamilton Lane, a major investment manager, launched a private credit fund on the Solana blockchain.
BUT, are we gonna see a Solana ETF? Well. The Securities and Exchange Commission (SEC) has to decide on this by March next year. Companies like VanEck and 21Shares have already filed applications for a spot SOL ETF.
There’s optimism because the SEC recently approved ether ETFs, something many thought wouldn’t happen. The approval came after the SEC stopped ETF issuers from earning returns, which seemed to resolve their concerns.
However, getting a Solana ETF approved isn’t guaranteed. The SEC has been cautious with spot Bitcoin ETFs because of worries about market manipulation.
Bitcoin and Ether have futures markets at the CME, which helped ease these concerns, but SOL doesn’t have that yet.
Some analysts believe that there needs to be an acceptable surveyable market for the SEC to gauge SOL on. On top of that, the SEC has made it clear that SOL is an unregistered security in its eyes.
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Disclaimer. The information provided is not trading advice. Cryptopolitan.com holds no liability for any investments made based on the information provided on this page. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decisions.
Jai Hamid
Jai Hamid has been covering crypto, stock markets, technology, the global economy, and the geopolitical events that affect markets for the past 6 years. She has worked with blockchain-focused publications including AMB Crypto, Coin Edition, and CryptoTale on market analyses, major companies, regulation, and macroeconomic trends. She has attended London School of Journalism and thrice shared crypto market insights on one of Africa’s top TV networks.
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