Author: Nancy, PANews

When the Solana ecosystem fell into a low point in sentiment, an ETF news once again ignited the market's optimistic expectations. On June 11, the US SEC required potential Solana spot ETF issuers to update their S-1 application documents. This move was seen by the market as a turning point signal that the Solana ETF entered the substantive review stage, sending a signal that the regulatory authorities have a positive attitude. Driven by this, the market's expectations for formal approval in July quickly heated up, and the Solana ecosystem ushered in a general rise in prices.

Solana spot ETF approval speeds up, SEC focuses on physical redemption and pledge mechanism

According to Blockworks, several people familiar with the matter revealed that the US SEC has notified several issuers that intend to launch Solana spot ETFs to submit updated S-1 registration statements within the next week. This means that several issuers that intend to launch Solana spot ETFs have been notified to submit updated S-1 registration statements within the next week.

Sources pointed out that the SEC will provide review feedback within 30 days after the S-1 document is submitted. The document update mainly focuses on the modification of the physical redemption language and the handling of the pledge mechanism. These two contents are also becoming the core focus of the approval process of crypto spot ETFs.

In the design of crypto asset ETFs, physical redemption means that investors can exchange ETF shares for the corresponding underlying assets (such as SOL) instead of cash. When the SEC reviews the S-1 document, the agency will focus on whether the issuer's description of how to implement physical redemption, how to calculate the asset value, and whether it supports the redemption of part or all assets in cash is clear, legal, compliant and operational. The setting of this mechanism is directly related to the market transparency, liquidity and arbitrage efficiency of the ETF, and its compliance statement has also become an important basis for the SEC to measure whether the ETF is suitable for retail and institutional investors.

The staking mechanism is another focus of market attention. Staking is a native asset appreciation method for PoS public chains such as Solana, which can bring on-chain benefits to holders. According to Staking Rewards data, as of June 11, Solana's staking rate was 65.44%, and the staking yield was 7.56%, more than twice that of Ethereum (3.13%). Previously, the SEC repeatedly avoided staking-related clauses in the approval of Ethereum ETFs, fearing that it might involve securities income attributes. However, in the negotiations with BlackRock on the Ethereum spot ETF in May this year, the SEC's attitude has loosened and began to accept the inclusion of staking functions under certain conditions. This time, an informed source revealed that the SEC is currently open to the inclusion of a staking mechanism in the Solana spot ETF, and therefore requires the issuer to have sufficient legal clarity and implementation details.

Since Grayscale first submitted the 19b-4 document for Solana spot ETF in 2024 and it was officially accepted by the SEC in February this year, Solana ETF has entered the substantive regulatory process. Although the SEC announced again at the end of May that it would delay the approval of some Solana ETFs on the grounds that it needed "more time to evaluate legal and policy issues", the S-1 document revision order released an important signal that the regulator no longer rejects the feasibility of Solana ETF and has shifted from a veto attitude to a rule game and detail polishing stage.

As of now, Fidelity, Franklin Templeton, VanEck, Bitwise, Canary Capital, 21Shares and Grayscale have all applied for Solana spot ETF.

Influenced by this news, Coingecko data shows that Solana ecosystem tokens have seen a general rise, and the price of SOL has hit a new high this month. Previously, due to the blood-sucking effect of Pump.fun's coin issuance and the diversion of liquidity incentives on other chains, Solana's participation enthusiasm has dropped significantly compared to the beginning of the year.

The earliest it could be launched is July, with a 90% chance of approval

After the successful launch of Bitcoin and Ethereum spot ETFs, market focus is rapidly shifting to potential targets for the next round of crypto spot ETFs.

Solana is the third crypto asset to apply for a spot ETF after Bitcoin and Ethereum. According to Blockworks, citing people familiar with the matter, judging from the latest ETF application document update rhythm, the Solana spot ETF is expected to be approved in the next 3 to 5 weeks, which means it may be approved as early as July, which is earlier than the market's general expectation of the end of the second half of the year.

Bloomberg ETF analyst James Seyffart said in his latest forecast that related products may be approved this year, or even as early as July. He said, "We believe that the SEC may now process 19b-4 application documents for Solana and pledged ETFs earlier than originally planned. Issuers and industry participants have likely been working with the SEC and its crypto asset working group to develop rules, but the deadline for the SEC to make a final decision on these applications is still in October this year."

Solana is believed to have met the key approval prerequisites. James Seyffart added that Solana and XRP's ETF applications currently have derivative ETFs approved, which paves the way for the approval of spot ETFs.

In fact, in March this year, Volatility Shares launched two Solana futures ETFs. This is the first L1 public chain project to obtain a US futures ETF license after Bitcoin and Ethereum, and is regarded as an important indicator for assessing the maturity of the spot ETF market. This path highly echoes the pace of Bitcoin and Ethereum spot ETFs, which first "explored" the futures ETF and then promoted the landing of spot products. (Related reading: The current situation of the Shanzhai ETF craze: a detailed look at the 2025 crypto ETF application )

Outside the United States, the Toronto Stock Exchange in Canada launched four Solana spot ETFs in April, which support staking functions. This product innovation not only shows its attractiveness to institutional investors, but also indirectly puts pressure on the SEC in terms of international supervision.

In James Seyffart's latest prediction of the approval probability of crypto spot ETFs, Solana and Litecoin are in the first tier in terms of approval probability. Among them, Litecoin and Solana have a 90% approval probability; XRP has an 85% approval probability; Dogecoin and HBAR have an 80% approval probability; Cardano, Polkadot, Avalanche have a 75% approval probability; and SUI has a 60% approval probability.

Although Solana has met most of the key conditions for approval of a US spot ETF, the SEC previously listed SOL as an "unregistered security" in its lawsuit against Coinbase and Binance. Although some of these lawsuits have been suspended or withdrawn, the securities label has not yet been formally clarified or ruled on, which still poses a potential obstacle.