The Securities and Exchange Commission (SEC) faces a deadline today to decide on Grayscale’s application to convert its Solana Trust (GSOL) into a Solana ETF.
This comes as the New York Stock Exchange (NYSE) Arca is proposing to list GSOL as a spot ETF on December 4, with the fund holding over 7.2 million shares outstanding as of January 21, 2025.
Regulatory Challenges:
With the departure of former SEC Chairman Gary Gensler and a new regulatory direction, significant hurdles remain.
The SEC has classified Solana as a security, complicating its approval decisions for ETFs tied to it.
According to Bloomberg analyst James Seyfart, this classification makes it difficult for other SEC departments to consider Solana as a digital commodity.
He said the approval timeline could stretch to 2026 unless legal and regulatory complexities are resolved.
The leadership changes at the SEC could positively impact future decisions.
The appointment of Paul Atkins, a well-known cryptocurrency supporter, as the proposed chair of the commission could open the door to major changes.
However, his confirmation process is expected to take several months.
Outlook:
As companies like VanEck, 21Shares, and Bitwise compete to offer Solana ETFs, analysts expect Litecoin ETFs to be the closest to approval under the current circumstances.
The Commodity Futures Trading Commission (CFTC) has recognized Litecoin as a commodity, which could facilitate the launch of exchange-traded funds linked to it.
The change in leadership could be key to reshaping the regulatory framework for digital assets, but it won’t lead to immediate decisions in favor of Solana ETFs.
