Grayscale Eyes Solana ETF After Bitcoin Mini Trust Debut

Prominent asset manager Grayscale Investment is considering launching a Solana exchange-traded fund (ETF) as the race for altcoin-based products heats up. However, Zach Pandl, the firm’s head of research, stated that existing regulations would not make Grayscale’s plan for a Solana ETF achievable. According to him, Grayscale would move to adapt its products to align with evolving regulatory changes.

Crypto’s Prominence and the US Election

With the US presidential election of 2024 drawing near, cryptocurrency has become a hot topic for candidates and voters. Attempts to create comprehensive laws for the cryptocurrency business are expected in the upcoming Congress, indicating the industry’s increasing significance in national conversations.

The industry’s influence over economic policies and laws in the future has become an important topic of discussion. Consequently, Grayscale’s chief of research, Zach Pandl, has highlighted the firm’s dedication to collaborating with authorities to develop solutions that adhere to new regulations.

The Surge in Crypto ETF in the US

The United States’ recent approval of spot Ethereum and Bitcoin ETFs is a major step toward the acceptance and integration of digital assets into the traditional finance markets. These achievements show how far digital asset ETFs have come, and experts in the field speculate that another cryptocurrency ETF is not too far off.

Head of VanEck’s digital asset research, Matthew Sigel, stated earlier this month that the choice of a new SEC chairman following the US elections in November will determine if the firm’s spot Solana ETF gets approved quickly. Sigel cited the lack of a regulated Solana futures market as a possible roadblock to its ETF approval. Still, he is optimistic that VanEck can secure approval without a regulated Solana futures market.

Prospects for an Altcoin ETF

Meanwhile, James Seyffart, an ETF expert at Bloomberg Research, has shared his insights regarding the difficulties in getting cryptocurrency ETFs approved in the US. He stated that it would take a while before a Solana (ETF) or any other digital asset is approved.

Seyffart pointed out that the SEC has approached crypto ETFs with caution. Moreover, the regulatory agency has classified SOL as a security, which makes the approval procedure even more difficult.

Seyffart claimed that one main obstacle to an altcoin ETF approval is figuring out if an asset is a security or a commodity. Hence, the possibility of a cryptocurrency ETF being approved in the upcoming year is minimal due to these variables.

Grayscale Debut Bitcoin Mini Trust

Meanwhile, the US Securities and Exchange Commission (SEC) has approved the launch of the Grayscale Bitcoin Mini Trust. This trust is a more affordable option (in terms of fees) than the well-known Grayscale Bitcoin Trust (GBTC).

The Grayscale Bitcoin Mini Trust, which has an expense ratio of just 0.15%, is more affordable than any recent exchange-traded product that holds Bitcoin in the US market, especially when compared to major players in the market like Fidelity and BlackRock. Notably, the new mini-trust has been seeded with 10% of the assets from GBTC.

Impacts of Grayscale Bitcoin Mini Trust

Even though major industry heavyweights like Binance, Coinbase, Uniswap Labs, and Ripple are still under regulatory examination, the increase in the number of ETF approvals in the US market heralds a new age for cryptocurrency investing in the country. Issuer rivalry has increased, and in an effort to draw assets, some of them briefly introduced zero-fee products.

Moreover, the crypto ETF sector has grown beyond Bitcoin. With the SEC’s July approval of several spot Ethereum funds, market participants now have more investing alternatives.