Regulatory Hurdles for Approval of Solana ETF

The approval of a Solana Exchange-Traded Fund (ETF) is expected to be influenced by changes within the Securities and Exchange Commission (SEC) and the potential victory of Donald Trump. VanEck, following the recent approvals of Bitcoin (BTC) and Ethereum (ETH) ETFs, is now seeking approval for its own Solana (SOL) ETF.

However, the cryptocurrency community anticipates significant regulatory challenges for any altcoin ETFs apart from Ethereum and Bitcoin. Analysts at VanEck acknowledge the need for substantial regulatory alterations before the approval of the Solana ETF.

In a recent interview with Bloomberg, Matthew Sigel, VanEck’s Head of Digital Assets Research, discussed the obstacles facing the approval of the Solana ETF.

Regulatory Challenges for Solana

Sigel highlighted the current SEC Chair Gary Gensler's strict conditions for altcoin ETFs, emphasizing the requirement of a regulated futures market for Solana, which is currently absent.

Sigel disagreed with this prerequisite, pointing out that ETFs for commodities like shipping and uranium do not rely on futures markets for price determination. He suggested that this condition might be a deliberate strategy to delay the approval of crypto ETFs.

According to Sigel, a shift in the SEC’s stance might be dependent on new leadership after the 2024 election. He emphasized the influence of pro-crypto voters on election outcomes, compelling both major political parties to take note.

Influence of Donald Trump

Sigel tacitly confirmed speculation that the approval of VanEck’s Solana ETF proposal is closely tied to Donald Trump potentially winning the U.S. presidency.

Former President Trump has altered his views on cryptocurrency, displaying more favorable opinions after receiving substantial donations from crypto entities. This shift in stance could impact his policy decisions in the future.

Moreover, there are suggestions that even if President Biden is re-elected, a change in the SEC’s approach to crypto might transpire as some Democrats have voiced backing for pro-crypto measures.

VanEck’s proposal for a Solana spot ETF is contingent on the outcome of the 2024 election, with the application deadline scheduled for March 2025. The filing of the Solana ETF proposal has generated considerable interest, leading to a surge in Solana’s price and trading volume.