TL;DR
- Speculation on Solana ETFs: The crypto community is abuzz with the possibility of Solana ETFs being approved in the US. GSR Markets suggests that Solana’s price could skyrocket if it captures a fraction of the flows from Bitcoin ETFs.
- Factors for ETF Approval: The SEC’s stance and potential changes in US leadership could influence the approval of a Solana ETF. The classification of SOL as a security complicates matters, but filings in the US and Canada show growing interest.
- Comparison with ADA and XRP: While Cardano and Ripple’s XRP may not see ETF approval soon, Solana’s decentralization and market demand position it favorably. The crypto ETF landscape is evolving, and Solana’s potential approval is a pivotal development to watch.
The potential approval of spot Solana exchange-traded funds (ETFs) in the United States has sparked intense speculation within the crypto community. According to GSR Markets, a prominent crypto market maker, this development could significantly impact Solana’s price trajectory.
GSR Markets recently identified Solana as one of “crypto’s big three” and explored the likelihood of Solana becoming the next spot cryptocurrency ETF to receive regulatory approval in the US. The report coincided with VanEck’s surprising filing for a spot Solana ETF.
GSR’s optimistic scenario suggests that if spot Solana ETFs capture 14% of the flows witnessed by spot Bitcoin ETFs since their launch in January, Solana’s price could surge by a remarkable 8.9x. This would propel Solana’s current price of $149 to over $1,320, resulting in a market capitalization of $614 billion based on the current supply.
However, GSR also presented more conservative scenarios. In the “bear” and “baseline” scenarios, where spot Solana ETFs capture 2% and 5% of Bitcoin’s flows, Solana’s price would still increase by 1.4x and 3.4x, respectively.
Factors Influencing Solana’s ETF Approval
Despite GSR’s optimism, Bloomberg ETF analyst Eric Balchunas remains cautious. He believes that a change in the US presidency and the chairmanship of the Securities Exchange Commission (SEC) would be necessary for serious consideration of a spot Solana ETF.
The knee jerk reaction here is 'oh this will never be approved bc there aren't Solana futures' agree but.. if change at POTUS i think anything poss. Just imagine Hester Peirce (or someone like that) running the SEC..
— Eric Balchunas (@EricBalchunas) June 27, 2024
The SEC’s classification of the SOL token as a security in lawsuits against Binance and Coinbase adds complexity to the approval process. VanEck’s recent application for a spot Solana ETF follows cryptocurrency asset manager 3iQ’s filing for the same in Canada, marking a significant milestone in North America.
Solana vs. ADA and XRP
GSR’s forecast extends beyond Solana. While Cardano (ADA) and Ripple’s XRP are unlikely to receive ETF approval soon, Solana stands out. Its decentralization and growing market demand make it a strong candidate. The recent filing of VanEck’s Solana spot ETF underscores the increasing institutional interest in Solana.
In summary, crypto ETFs remain a hot topic, and Solana’s potential breakthrough could reshape the landscape. As the SEC’s decisions unfold, investors eagerly await the next chapter in the crypto ETF saga.
Remember, the approval of other crypto ETFs, including Solana, hinges on regulatory changes. A regulated market is essential to monitor these assets for fraud and manipulation, ensuring investor confidence and market stability.
