SEC Delays Solana ETFs Again Amid Ongoing Regulatory Review

SEC Delays Solana ETFs from 21Shares and Bitwise for Further Review

The U.S. SEC has again delayed the ruling for two major Solana (SOL) spot ETF applications, keeping investors and crypto traders on waiting. The two applications by Bitwise and 21Shares are now being extended in review, as the SEC starts new proceedings to determine if they qualify for approval under legal standards.

Why the SEC Is Delaying Solana ETFs

The commission stated that the delay is crucial to ensure the proposed ETFs follow the rules under the Securities Exchange Act. This involves safeguarding investors interest and preventing fraudulent activities or market manipulation. In the official statement, the commission said, it will require more time to study the proposals and accumulate public comments. 

This is not the first delay. Bitwise filed the application in January through Cboe’s BZX Exchange, on the other hand 21Shares had filed even earlier. The SEC first postponed application of Bitwise in March and has now extended the review again. 

21Shares already manages spot ETFs for Bitcoin and Ethereum, but like Bitwise, it has yet to get the green signal for this crypto. The longer review process for Solana ETFs may reflect concerns about the market stability of currency or trading practices, even after Solana is considered as a faster and low-cost blockchain than Ethereum.

Other Crypto ETFs Also on Hold

This delay is not just about Sol. The SEC recently slowed down its decision on the SOL ETF applied by Grayscale as well. In fact, many digital asset ETFs are facing delays. Although investors are excited to see more crypto-related products in conventional finance, the SEC is moving cautiously.

Despite these delays, some experts remain hopeful. Bloomberg analysts James Seyffart and Eric Balchunas believe there is a 90% chance that this crypto etf will ultimately going to be approved. They also say Litecoin ETFs have the same odds, with XRP close behind at 85%. Dogecoin and Cardano are estimated to have 80% and 75% approval chances, respectively. 

Source: Eric Balchunas

What It Means for Solana and Investors

The delays are somewhere hampering the price of the currency. Currently, the token trades at $168.65, a slight increase of 2.12% in a day as per the CoinMarketCap. Although institutional interest in this crypto is increasing, the lack of  approval by regulators may be hampering its market growth. 

Source: CoinMarketCap

The recent introduction of Solana futures by the CME Group indicates that there is demand for regulated Solana-based investment vehicles. Futures enable investors to make bets on the price of this crypto without actually holding the asset. But a spot ETF would facilitate everyday investors to get exposure to Sol via normal brokerage accounts.

When Will a Decision Be Made?

The SEC will likely take a few more months before they make a final ruling. Some experts have opined that we will not see definitive answers until later in 2025. Investors need to remain patient while regulatory difficulties continue to set the future of crypto products.

For the moment, however, the vision of having Solana ETFs listed on U.S. exchanges continues to exist, but remains in suspension.