The crypto-focused asset manager Bitwise took an initial step toward launching a SOL ETF yesterday when it registered a statutory trust in Delaware. Bitwise becomes the fourth firm to show interest in a spot SOL ETF following earlier filings from VanEck, 21Shares and Canary Capital.
I spoke with Bitwise CEO Hunter Horsley, who cast Solana as one of this crypto market cycle’s breakout successes that he thinks clients will want to access. The firm also recently filed for an XRP ETF.
Bitwise’s filing is the latest indication that despite Solana’s lack of a regulated futures market in the US — long thought to be a requirement for spot crypto ETFs — a potentially more crypto-friendly Trump administration could get SOL ETFs across the finish line.
The move comes as a FOX Business correspondent reported on social media that the SEC is more actively engaging with spot SOL ETF applicants. This is an about face from August, when The Block reported that the SEC rejected 19b-4 filings from the Cboe exchange, a key component in bringing about an agency decision.
The obvious difference between now and then is the regulatory outlook, with SEC chair and crypto industry bogeyman Gary Gensler announcing his resignation from the agency. Horsley said the US presidential election was “absolutely relevant” in Bitwise’s decision to file for a SOL ETF, and now feels like a “constructive time” to engage with regulators after mulling over an application for around a year.
Like competitors VanEck and 21Shares, Bitwise currently offers a Solana exchange-traded product in Europe — a product it gained access to by way of acquiring London-based ETC Group in August. The Solana ETP currently has $27 million in assets under management (AUM), which is dwarfed by some competitors — 21Shares’ Solana ETP holds nearly $1.4 billion, for instance.
With a potential spot ETF, Bitwise and its competitors will seek to let US investors get exposure to SOL’s price action in a regulated wrapper.
SOL has the chance to become the third crypto to get a US-traded ETF. The first, bitcoin, saw impressive inflows after launching while the second, ether, was much less in-demand. I asked Horsley if the uninspiring ether flows spelled trouble for SOL ETFs. He responded that ether ETFs faced an uphill battle since they launched over the summer (when asset managers are likely vacationing in the south of France), ether hasn’t had great price action this market cycle, and two crypto ETFs were a lot for slow-moving capital markets to absorb in a short time.
Horsley was effusive in talking about Solana overall, calling SOL “an incredible emerging asset and story.” Later on, the Bitwise boss said many bitcoin ETF buyers may be looking for the “next big thing” in crypto.
“For a lot of investors, the answer to that is Solana,” Horsley said.
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