US Solana ETF Race Heats Up as Cboe BZX Submits 4 Refilings

Cboe BZX Exchange has reignited the race for Solana-based ETFs, refiling a fresh batch of applications on behalf of four major investment firms on Tuesday.

The exchange submitted new 19b-4 filings for the Canary Solana Trust, Bitwise Solana ETF, 21Shares Core Solana ETF, and VanEck Solana Trust.

With these applications, the Securities and Exchange Commission will restart its review process for spot Solana investment products. It comes after the withdrawal of previous applications last year at the regulator’s request.

If approved, these ETFs would offer traditional investors exposure to Solana without directly holding the crypto, potentially broadening access to the digital asset market.

The latest filings ride on the momentum of crypto ETF approvals, with Bitcoin and Ethereum products gaining SEC clearance in early 2024.

But, unlike the world’s two-largest cryptos, Solana faces unique regulatory hurdles.

The core challenge centers on whether Solana qualifies as a commodity or security, a distinction that proved critical in previous industry-related ETF approvals.

Both the Canary Solana Trust and VanEck Solana Trust are seeking approval under commodity-based trust frameworks.

The proposals mirror successful Bitcoin and Ether ETF strategies, arguing that SOL qualifies as a commodity through its decentralized structure and proof-of-stake consensus.

Based on the documents listed by Cboe BZX and reviewed by Decrypt, both proposals argue manipulation can be prevented without the surveillance-sharing agreements usually required by the SEC, citing trading volume and round-the-clock global markets.

While sharing core arguments about SOL’s commodity status and market maturity, the proposals reveal distinct approaches to addressing regulatory concerns.

VanEck emphasizes declining ownership concentration and validator autonomy, which provided data showing top wallet holdings had dropped to 26.5% last year.

On the other hand, Canary focuses on operational safeguards such as segregated cold storage and detailed NAV (net asset value) calculations, with both sponsors carefully positioning their products within established crypto-commodity ETF frameworks.

Meanwhile, Grayscale has separately pursued its own Solana ETF ambitions. The firm filed in December to convert its existing Solana Trust into an ETF on NYSE Arca.

The push comes as Solana maintains its position as the third-largest crypto, with a market capitalization exceeding $111 billion, according to data from CoinGecko.

Edited by Sebastian Sinclair