Written by: Nancy, PANews
At a time when the Solana ecosystem is experiencing low sentiment, an ETF news has once again ignited market optimism. On June 11, the US SEC requested potential Solana spot ETF issuers to update their S-1 application documents. This move is seen by the market as a turning signal for Solana ETF entering the substantive review stage, releasing a positive signal from regulators. Driven by this, market expectations for approval in July quickly heated up, and the Solana ecosystem subsequently ushered in a widespread rally.
Solana Spot ETF Approval Accelerates, SEC Focuses on Physical Redemption and Staking Mechanism
According to Blockworks, multiple informed sources revealed that the US SEC has notified several issuers planning to launch Solana spot ETFs to submit updated S-1 registration statement documents within the next week.
Sources indicated that the SEC will provide review feedback within 30 days after the S-1 file submission, with updates mainly focusing on modifying physical redemption language and handling the staking mechanism, which have become core concerns in the crypto spot ETF approval process.
In crypto asset ETF design, physical redemption means investors can exchange ETF shares for corresponding underlying assets (such as SOL), rather than cash. During S-1 file review, the SEC will focus on examining how issuers describe physical redemption execution, asset value calculation, and whether partial or full asset cash redemption is supported.
The staking mechanism is another market focus. Staking is a native asset appreciation method for PoS public chains like Solana, providing on-chain returns for holders. Staking Rewards data shows that as of June 11, Solana's staking rate is 65.44%, with a staking yield of 7.56%, more than double Ethereum's (3.13%). Previously, the SEC often avoided staking-related terms in Ethereum ETF approvals, concerned about potential securities income attributes. However, in May negotiations with BlackRock about the Ethereum spot ETF, the SEC's attitude has softened, beginning to accept staking functionality under specific conditions.
Since Grayscale first submitted the Solana spot ETF 19b-4 file in 2024 and was formally accepted by the SEC in February, the Solana ETF has entered a substantive regulatory process. Although the SEC announced a delay in approving some Solana ETFs in late May, citing the need for "more time to assess legal policy issues", this S-1 document revision instruction signals that the regulatory body no longer rejects the Solana ETF's feasibility.
Currently, Fidelity, Franklin Templeton, VanEck, Bitwise, Canary Capital, 21Shares, and Grayscale have all submitted Solana spot ETF applications.
Influenced by this news, CoinGecko data shows a rally in Solana ecosystem tokens, with SOL price hitting a new monthly high.
Potentially Approved in July, with Up to 90% Approval Probability
After Bitcoin and Ethereum spot ETFs successfully landed, market focus is quickly shifting to potential next-round crypto spot ETF targets.
Solana is the third crypto asset to apply for a spot ETF after Bitcoin and Ethereum. According to Blockworks, based on the latest ETF application file update pace, the Solana spot ETF is expected to be approved within 3 to 5 weeks, potentially as early as July.
Bloomberg ETF analyst James Seyffart predicted in his latest forecast that related products might be approved this year, possibly as early as July.
Solana is considered to have met key approval prerequisites. James Seyffart added that Solana and XRP ETF applications already have derivative ETFs approved, paving the way for spot ETF approval.
In fact, in March this year, Volatility Shares launched two Solana futures ETFs, the first L1 public chain project to receive US futures ETF permission after Bitcoin and Ethereum.
Outside the US, the Toronto Stock Exchange launched four Solana spot ETFs supporting staking in April, showing attractiveness to institutional investors and indirectly pressuring the SEC.
In James Seyffart's latest crypto spot ETF approval probability prediction, Solana and Litecoin are in the first tier, with 90% approval probability. XRP has an 85% probability, Dogecoin and HBAR around 80%, Cardano, Polkadot, and Avalanche at 75%, and SUI at 60%.
Although Solana has most key conditions for US spot ETF approval, the SEC previously listed SOL as an "unregistered security" in lawsuits against Coinbase and Binance, which still constitutes a potential obstacle.
