SEC Set to Reject Solana ETFs in Gensler’s Final Crypto Crackdown, Says Bloomberg Analyst
- It appears SEC Chair Gary Gensler plans to reject Solana Spot ETFs as he exits, with his term ending as Trump begins his second term in the White House.
- Analysts say the rejection stems from ongoing legal debates over whether Solana is a security.
- Meanwhile, Bitcoin and Ethereum ETFs in the US continue to attract significant investments, overshadowing Solana’s ETF prospects.
It seems the Chair of the US Securities and Exchange Commission (SEC), Gary Gensler, has a few tricks up his sleeve. Gensler, set to leave the agency in January when Donald Trump starts his second term in the White House, apparently has a “parting gift” for the crypto community.
Related: ‘China’s MicroStrategy’ Exits Bitcoin, Cashes Out Before $100K Milestone
Bloomberg Senior ETF Analyst Eric Balchunas commented on reports that the SEC is going to reject applications for Solana Spot exchange-traded funds (ETFs).
Fox Business reporter Eleanor Terrett had the scoop, saying that “at least two of the five prospective issuers” had been notified by the SEC that their 19b4 filings for SOL ETFs had been rejected.
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Expect More Delays, Says Seyffart
Fellow ETF analyst James Seyffart said that although disappointing, the SEC really had no choice but to delay these ETFs, given the ongoing legal issues around the status of Solana. In a recent filing in its case against Binance, the SEC is still alleging that SOL and other coins are securities.
With these ongoing cases, the SEC simply could only deny the applications, Seyffart said:
It’ll be up to the new admin to sort out the lawsuit situation and SOL’s status as a security. Any applications are (and should be, in my opinion) dead in the water until a plan is set to rectify that situation. Whether that’s complete withdrawal or settlement etc., I don’t know.
James Seyffart, Bloomberg
Asked whether this would push back the timeline for the Spot Solana ETF application – which the analyst had previously expected to be approved in August 2025 – Seyffart smashed any hopes of soon buying SOL ETFs:
Bitcoin and Ethereum ETFs Continue to Grow
With no Solana-related ETF in the United States anytime soon, the Spot Bitcoin and Ethereum ETFs seem the best option right now for US-based investors. The funds continue to accumulate at a steady pace, with the BTC ETFs now overtaking Satoshi Nakamoto’s stash of Bitcoin in size.
BTC ETFs saw US$2.7 billion (AU$4.2 billion) in inflows last week, while Ether ETFs had a more modest US$836.8 million (AU$1.3 billion) in inflows over the same time period.
Related: Bitcoin Flash Crash to $90k Wipes Out Over $1 Billion in Leveraged Positions
That’s a strong start to the month, with ETH ETFs particularly gaining momentum lately. The past few weeks these funds have been enjoying increasing inflows coupled with an increase in ETH price.
At the time of writing, ETH is up 7% week-on-week, but slightly down on the 24-hour window (-0.7%), while BTC is up both on the weekly (+3%) and daily (+0.5%) timeframes, and SOL has lost 4% on the daily and 1.5% on the weekly timeframe.
