Altcoin ETF season: which crypto fund is next?

The
spot
Ethereum
ETF
approval
has
given
the
crypto
community
hope
for
the
launch
of
other
altcoin-based
funds.

Last
week,
the
U.S.
Securities
and
Exchange
Commission
(SEC)
approved
applications
for
the
opening
of
spot
Ethereum
ETFs.
The
cryptocurrency
community
sees
this
move
as
an
opportunity
to
launch
funds
with
other
leading
altcoins,
including
the
Solana
ETFs.

How
a
spot
ETF
works

A
spot

ETF
is
a
tool
through
which
stock
exchange
participants
can
invest
in
digital
cryptocurrency
without
purchasing
and
storing
it
in
physical
form.
This
procedure
is
based
on
tracking
the
actual
market
price
of
the
asset.

After
purchasing
shares
of
a
spot
ETF,
the
investor
receives
a
stake
in
the
fund.
The
fund
represents
a
certain
volume
of
cryptocurrencies
in
their
real
form.
Fund
specialists
manage
the
portfolio.

With
a
spot
in
the

Bitcoin
ETF,
investors
easily
gain
exposure
to
the
cryptocurrency.
They
do
not
need
to
purchase,
hold,
or
manage
their
portfolios
independently,
which
could
provide
impetus
for
increased
investment
in
the
cryptocurrency
market.

Acceptance
of
Crypto
ETFs
in
the
U.S.

At
the
end
of
2021,
the
SEC
allowed
the
launch
of
futures
Bitcoin
ETFs
for
the
first
time.
Then,
in
January
2024,
the
SEC
approved
the
first
11
spot
Bitcoin
ETFs.

Grayscale‘s
lawsuit
against
the
SEC
was
vital
in
changing
the
regulator’s
position.

The
victory
in
the
case
and
the
subsequent
recognition
of
the
legality
of
spot
ETFs
made
it
possible
to
reduce
the
distance
between
digital
and
traditional
assets.
Grayscale,
which
previously
operated
the
Bitcoin
Trust
with
certain
restrictions,
now
has
the
opportunity
to
transform
into
a
full-fledged
ETF.

Altcoin
ETFs

The
SEC
approved
Forms
19b-4
for
eight
Ethereum-based
exchange-traded
funds
(Grayscale,
Bitwise,

BlackRock,

VanEck,
ARK
21Shares,
Invesco,

Fidelity,
and
Franklin)
in
a
single
decision,
thus
marking
the
beginning
of
altcoin-based
ETFs.

Following
the
approval
of
the
Ethereum
ETF,
the
crypto
community
is
wondering
whether
funds
based
on
other
popular
altcoins
will
see
the
green
light.

Solana
ETF

Solana
(SOL),
a
rising
star
in
the
blockchain
arena,
could
also
be
a
candidate
for
its
spot
ETF.
The
creation
of
the

Solana
ETF
is
still
subject
to
regulatory
approval.
To
do
this,
the
fund
issuer
must
demonstrate
that
the
funds
comply
with
all
legal
and
regulatory
standards,
including
investor
protection
and
market
integrity.

While
the
exact
timing
of
approval
remains
unclear,
experts
believe
Solana
could
soon
enter
the
cryptocurrency
spot
ETF
market.

What
industry
participants
are
saying

The
CEO
of
the
investment
company
BKCM,
Brian
Kelly,
said
that
after
the
legalization
of
spot
Ethereum
ETFs,
Solana
ETFs
will
enter
the
American
stock
market.
This

altcoin
will
become
the
main
competitor
to
ETH.

But
SEC
isn’t
dancing
around
SOL’s
status
like
they
have
ETH.
Those
lawsuits
against
COIN
and
Kraken
and
others
flat
out
say “Solana
is
a
security”
lol.
Which
could
very
easily
make
this
a
very
rocky
road

—
James
Seyffart
(@JSeyff)

May
22,
2024

Bloomberg
ETF
analyst
James
Seyffart
also
noted
that
after
Bitcoin
and
Ethereum
ETFs,
exchange-traded
fund
providers
will
likely
turn
their
attention
to
Solana.

According
to
Seyffart,
it
will
be
a
couple
of
years
before
the
crypto
derivatives
market
is
fully
supervised
by
the
U.S.
Commodity
Futures
Trading
Commission
(CFTC).
The
expert
emphasized
that

the
approval
of
the
bill
“On
Financial
Innovation
and
Technologies
for
the
21st
Century”
(FIT21)
can
speed
up
this
process.

Based
on
current
precedent/needs
—
Will
happen
within
a
few
years
of
getting
a
CFTC
regulated
futures
market.
But
congress
&
Market
structure
bills
like
FIT21
could
make
it
happen
quicker.

I
think
a
SOL
ETF
would
see
most
demand
vs
other
digital
assets
(aside
from
BTC
&
ETH)

—
James
Seyffart
(@JSeyff)

May
22,
2024

Bitwise
Investment
CEO
Hunter
Horsley
claimed
that
by
the
end
of
2024,
the
cryptocurrency
community
will
be
surprised
at
how
many
financial
concerns
will
invest
their
capital
in
Bitcoin
spot
ETFs.

The
head
of
Bitwise
is
convinced
that
distributing
a
new
class
of
digital
assets
will
make
the
crypto
market
even
more
attractive
to
investors.

By
the
end
of
2024,
people
are
going
to
be
stunned
by
how
many
wealth
management
firms
own
a
bitcoin
ETF.

They’re
smart,
many
extremely
well
informed,
and
increasingly
share
conviction
on
Bitcoin.
Oh,
and
they’re
long
only.

Going
to
be
an
amazing
new
constituent
in
the…

—
Hunter
Horsley
(@HHorsley)

April
20,
2024

Tristan
Frizza,
founder
of
Zeta
Markets,
commented
to
crypto.news
that
many
consider
BTC,
ETH,
and
SOL
to
be
the
three
significant
cryptocurrencies
of
this
market
cycle.
Therefore,
with
the
approval
of
the
ETH
ETF,
SOL
will
likely
be
the
next
ETF
candidate.

“While
Bitcoin
has
been
touted
as
‘digital
gold’
and
Ethereum
has
institutional
focus,
Solana
is
the
network
embraced
by
retail
users
with
consistently
among
the
highest
activity
metrics.
The
recent
booms
of
protocol
launches
and
token
TGEs
on
Solana
have
also
brought
a
lot
of
attention,
users,
and
capital
inflow
to
the
network,
and
the
anticipation
of
further
growth
will
make
it
seem
more
than
likely
to
place
Solana
as
a
lead
asset
to
be
considered
for
the
ETF.”

Tristan
Frizza,
Zeta
Markets
founder

While
nothing
is
clear
yet,
the
impact
of
such
ETF
approval
will
likely
attract
subsequent
attention,
capital,
developer,
and
user
activity,
which
will
further
spin
up
Solana’s
existing
flywheel,
and
that’s
what
many
of
the
network’s
backers
are
likely
counting
on,
Frizza
concluded.

crypto.news
also
requested
comment
from
the
Solana
Foundation
team
regarding
the
likelihood
of
the
Solana
ETF
being
approved.

Conclusion:
will
the
crypto
industry
see
Solana
ETFs?

The
SEC’s
approval
of
Bitcoin
spot
ETFs
has
sparked
interest
in
the
potential
of
Solana-based
ETFs,
which
could
make
investing
in
the
SOL
token
more
accessible
to
everyone.

Approving
an
altcoin
ETF
would
be
a
significant
milestone,
potentially
similar
to
approving
the
spot
Bitcoin
and
Ethereum
ETFs.
It
would
promise
to
attract
more
institutional
players
to
the
cryptocurrency
market.