A group of crypto companies, including Jito Labs and Bitwise, has reached out to the U.S. Securities and Exchange Commission (SEC) requesting the integration of liquid staking tokens (LST) in exchange-traded products.
Statement from Crypto Companies
Companies Jito Labs, Bitwise, Multicoin Capital, VanEck, and the Solana Institute have jointly submitted a public letter to the SEC. In this letter, they called for the approval of using LST in the pending Solana ETF applications from eight major issuers.
Benefits of Using LST
The authors of the letter argue that LSTs provide operational resilience, capital efficiency, and enhanced risk management. They note that this approach aligns with the SEC's recently announced guidelines for in-kind creation and redemption processes for cryptocurrency ETFs.
Comparison with Other ETFs
Currently, spot ETFs for Bitcoin and Ethereum are trading on exchanges and are notable for their high inflow rates. The SEC recently approved in-kind refunds for Bitcoin and Ethereum spot ETFs, and this approval is expected to apply to Solana if the ETF is approved.
The outreach by crypto companies to the SEC highlights the growing interest in LST and their potential integration into ETFs, which could support the development of the Solana ecosystem.
