As a seasoned crypto investor with over two decades of experience navigating the ever-evolving digital asset landscape, I find myself once again faced with uncertainty and intrigue. The recent disappearance of the Solana ETF filings from the SEC’s docket has set off a storm of speculation within our community.
The sudden disappearance of these filings has raised concerns within the crypto community, with many questioning whether the U.S. Securities and Exchange Commission (SEC) may have signaled a reluctance to approve the proposed Solana ETFs.
SEC’s Historical Caution with Digital Asset ETFs
As an analyst, I’ve noticed a consistent cautious approach by the SEC towards approving financial products tied to digital assets, such as Bitcoin and Ethereum ETFs. Their apprehension stems from concerns about potential market manipulation and investor protection, factors that often prolong the review process. In contrast to the Solana ETF applications that were withdrawn from the Cboe website, there were no instances of incomplete forms during the lengthy review periods for Bitcoin and Ethereum ETFs, which spanned several months.
Regarding Ethereum’s ETFs, the SEC initially pondered over rejecting them but eventually gave their approval on July 23. This situation has sparked curiosity about the SEC’s viewpoint towards the Solana ETF applications.
The removal of the Solana ETF forms from the Cboe website was first discovered by a user on X. He noted that the Form 19b-4 filings by both VanEck and 21Shares are no longer accessible on the Cboe website via direct links. He also pointed out that these documents, filed on July 8, had not been officially acknowledged by the SEC before their removal from the site.
Forms 19b-4 for VanEck and 21Shares Solana ETFs appear to have been removed from the CBOE website.
The documents labeled as SR-CboeBZX-2024-066 and SR-CboeBZX-2024-067 can no longer be accessed directly, and they have disappeared from the list of pending rule changes on BZX.
Another interesting thing is…
— Summers (@SummersThings) August 16, 2024
Rumors of SEC Involvement
As a crypto investor, I’ve been keeping an eye on the recent developments with Solana ETFs. Both VanEck and 21Shares submitted proposals for these ETFs, and Cboe Global Markets followed suit with a proposal to list them on their platform, subject to SEC approval. Interestingly, Cboe also invited public input on the product. However, the sudden silence surrounding the filings has led to speculation that the SEC might have expressed reservations to VanEck and 21Shares, leading these firms to reconsider their applications.
Some experts in the field believe that some asset managers could be choosing to temporarily withdraw their applications to deal with potential regulatory hurdles and then reapply later. Meanwhile, Nate Geraci, president of the ETF Store, used platform X to express his opinion that this withdrawal indicates SEC Chair Gary Gensler’s reluctance to approve a Solana ETF while he is in office.
In response, finance attorney Scott Johnson hypothesized that the SEC Chair may have communicated to Cboe that the Solana ETF would likely be rejected under his administration. Furthermore, Johnson proposed that Gensler might have implied that the applications were inappropriately submitted due to his viewpoint on Solana not categorizing it as a commodity.
Instead of walking through the entire 19b-4 procedure, Johnson suggested that Gary might have informed Cboe directly about the improper filing of Solana applications as Commodity-Based Trust Shares, since he believes Solana isn’t considered a commodity. This action, in his opinion, eliminates the requirement for the SEC to issue a formal written disapproval order (which can be challenged as final agency action).
Uncertainty for the Solana Community
The optimism within the Solana community, who saw these ETFs as potential catalysts for wider acceptance of their network, is now met with apprehension. If the Securities and Exchange Commission (SEC) were to reject the ETF proposals, it could potentially be a major hurdle in the process of integrating Solana with conventional financial systems.
Some supporters of Solana believe that recent advancements might lead to a continued decrease in the value of SOL. Currently, this digital currency is one of many affected by the ongoing turbulence in the cryptocurrency market. In the last 24 hours, the token has decreased by almost 2% to approximately $144, as indicated by data from CoinMarketCap.
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2024-08-19 19:01