Franklin Templeton, managing $1.53 trillion in assets, has filed with the SEC to launch a Solana-linked ETF, aiming to provide investors with a regulated way to access this cryptocurrency.
Regulation and Guidance for Solana
The proposed Franklin Solana ETF would trade on the Cboe BZX Exchange. Solana (SOL) would be directly held by the ETF, providing exposure to the cryptocurrency's price fluctuations. The custodian for digital assets will be Coinbase Custody Trust Company, LLC. The ETF will not be registered under the Investment Company Act of 1940, nor will it operate as a commodity pool under the Commodity Exchange Act. Franklin Templeton believes the Solana market is resistant to manipulation due to its decentralized nature and continuous trading.
Transparency and Investor Protection
A key aspect of the Franklin Solana ETF is its transparency. The fund's net asset value will be calculated daily, offering clear insights into its performance. Investors can make decisions based on intraday values disseminated every 15 seconds during trading hours. This approach helps reduce the risks associated with direct digital asset holdings.
Expanding the Crypto ETF Market
The filing by Franklin Templeton aligns with a broader trend of increasing crypto ETF applications. Financial companies like Grayscale Investments and VanEck have also filed for ETFs tied to various digital assets. Although the SEC has previously approved Bitcoin and Ether-based ETFs, the approval of Solana-linked ETFs remains an open question.
The application for Franklin Solana ETF indicates rising institutional interest in Solana and the desire to offer regulated products that meet modern investor demands. Despite potential regulatory delays, the approval outlook remains optimistic.
