- The second company to file to start a SOL exchange-traded fund in the United States in as many days is 21Shares.
- The company agrees with VanEck that Solana’s native token ought to be handled like a commodity.
- Experts warn that the SEC’s Enforcement Division’s previous declaration that SOL is a security could provide a significant obstacle to the launch of these funds.
Investment company 21Shares filed an S-1 form with the U.S. government one day after competitor VanEck filed a comparable form. Securities and Exchange Commission for an exchange-traded fund based in Solana.
This is the second SOL ETF filing in the United States in as many days, confirming the forecast of some analysts that competitors looking to establish Solana-based funds would find it easier to get in after VanEck’s June 27 filing.
21Shares is excited about the prospect of a US ETF that provides investors with access to the Solana ecosystem. “We believe this is a necessary step for the crypto industry and it holds true to our mission to bring to market easily accessible financial products centered around crypto assets,” said Andrew Jacobson, head of legal at 21Shares.
With approximately $846 million in assets under management, the Zurich, Switzerland-based 21Shares already oversees an exchange-traded product called Solana Staking that is physically backed. Additionally, it oversees an ETF for bitcoin trading on the Cboe BZX Exchange.
Similarly, both the VanEck Solana Trust and the 21Shares Core Solana ETF would be traded on the Cboe BZX Exchange. Redeemable amounts would be made in-kind, that is, in SOL as opposed to cash, in accordance with existing exchange-traded products for spot-market commodities other than SOL, according to the company’s S-1 filing.
Legal experts have pointed out that despite increased interest from potential issuers, it is unlikely that SOL ETFs will pass the SEC’s muster for a number of reasons, including the absence of a regulated futures market for SOL and the asset’s prior classification as a security in the SEC Enforcement Decision.
Although there is legal precedent supporting the inclusion of a cryptocurrency token in a CME futures contract, Jacobson said this shouldn’t be the sole prerequisite for an ETF to be qualified as many cryptocurrencies satisfy the criteria to be tradable ETFs. One strategy to increase access to cryptocurrencies as an asset class, in our opinion, is the ETF wrapper.
Coinbase Custody will handle the fund custody for the 21Shares SOL fund.
Disclaimer : This article was created for informational purposes only and should not be taken as investment advice. An asset’s past performance does not predict its future returns. Before making an investment, please conduct your own research, as digital assets like cryptocurrencies are highly risky and volatile financial instruments.
