VanEck files Solana ETF; SOL Increases 6% during overall crypto market recovery.
TakeAway Points:
- Solana (SOL) surged by more than 6% when VanEck filed for the first Solana (SOL) ETF in the United States.
- This comes six days after a comparable Solana ETF debut in Canada.
- For the soon-to-be ETH ETFs, analysts anticipate large inflows; $5 billion in net inflows is anticipated in five months.
VanEck Files for Solana ETF
In a significant move for the cryptocurrency market, asset manager VanEck has filed an S-1 registration form with the Securities and Exchange Commission (SEC) for a Solana (SOL) exchange-traded fund (ETF). This filing marks the first ETF registration for Solana in the U.S., coming just six days after a similar product was launched in Canada. The news has had an immediate impact on Solana’s price, which jumped by more than 6%.
The SEC’s approval of the first spot Bitcoin ETF in February has set a precedent, and an Ether ETF appears to be on the horizon. Analysts predict that Ether ETFs could attract $5 billion in net inflows within the first five months. VanEck’s filing for a Solana ETF follows a similar process the company underwent for its Ether ETF, indicating a growing interest in diversifying crypto investment products.
Expansion of Crypto Market Rebound
The cryptocurrency market saw a broad rebound on Tuesday, with Bitcoin leading the charge. Bitcoin advanced more than 3% to $61,741.78, according to Coin Metrics. This recovery comes a day after Bitcoin slumped below $60,000 for the first time since early May, triggering a broad sell-off in crypto assets. The rebound coincided with a recovery in Nvidia and the Nasdaq Composite, both of which had suffered their worst days since April in the previous session.
Noelle Acheson, economist and author of the “Crypto is Macro Now” newsletter, commented on the market dynamics that “When the stock market turns, we are likely to see panic selling in crypto as well, for no fundamental reason other than emotion and perhaps the need to raise cash for margin calls. Yesterday, crypto got hit with some risk asset jitters.”
Solana was the standout performer, jumping 8% after the Solana Foundation announced an update that will allow users to share on-chain actions as shareable links around the internet. Chainlink, which provides data feeds on the Solana network, saw its token gain 7%. Other Ethereum rivals also saw gains, with Cardano’s ADA up more than 6%, Polkadot up 5%, and Binance Coin rising 3%.
Ben Kurland, CEO at crypto research platform DYOR, noted, “Today’s news from Solana is a jolt of positivity. The idea that more than a billion people can now easily access and use SOL is one that is uniformly positive for the alt coin and its ecosystem, and traders rallying into other alt coins are likely betting that this momentum will carry over into the broader DeFi and Web3 marketplace.” However, he added, “I doubt we see the actual impact of this news for some time, and my money is on us heading back towards the type of market action we saw earlier this week.”
State Street and Galaxy Digital Partnership
In another development, State Street Global Advisors and Galaxy Asset Management announced they are working together to build crypto products that offer exposure to crypto companies as well as spot and futures-based ETFs. State Street Global Advisors, a unit of financial services giant State Street, has filed an application with the SEC to register a crypto-based fund called the SSGA Active Trust. Galaxy Digital will manage the fund’s investments.
The companies stated, “Together, we will provide investors access to the $2.4 trillion digital asset ecosystem through manager-directed strategies.” This collaboration aims to offer investment options beyond pure spot Bitcoin, reflecting the growing recognition of the cryptocurrency industry since the U.S. approval of spot Bitcoin ETFs in January.
Anna Paglia, State Street Global Advisors’ chief business officer, emphasized the broader scope of digital assets: “We believe that the digital assets landscape is so much more than the single crypto components and that crypto native companies are best equipped to understand that ecosystem and its correlation with financial markets.”
Laurent Kssis, a crypto ETF specialist at CEC Capital, commented on the collaboration: “The expectation is that State Street Bank and Trust would provide administrative and accounting services for the new digital assets ETFs that State Street Global Advisors and Galaxy jointly develop pursuant to this collaboration. The announcement appears short on detail.”
