As discussions about the Solana spot ETF become more active, whales are showing interest in this token. This comes after the approval and launch of Bitcoin (BTC) and Ethereum (ETH) ETFs, making the cryptocurrencies accessible to institutional players such as retailers.
The Solana blockchain is popular for its fast transaction speeds and low costs. These fundamentals, along with future approvals, will increase demand and liquidity for Solana.
Whales Positioning for Solana ETF
LookOnChain, which provides on-chain data and insights for the cryptocurrency market, reported that two whales withdrew 238,893 SOL worth $41.4 million from Binance over the past two days. They staked these assets, suggesting interest in the tokens and optimism about their potential. What is noteworthy is that staking demonstrates trust in an asset while also expecting rewards.
“Over the past two days, two whales have withdrawn and staked 238,893 SOL ($41.4 million) from Binance,” LookOnChain reported .
The sign of confidence in SOL's potential for development comes amid growing social dominance over the Solana ETF.
Read more: Solana ETF Explained: What is the Solana ETF and How Does It Work?
Analysts are optimistic about the Solana ETF despite only two applications being filed with the U.S. Securities and Exchange Commission (SEC). Eric Balchunas, senior ETF analyst, said the approval of the Ethereum ETF would pave the way for other similar financial products, demonstrating the popularity of cryptocurrency ETFs. He singled out Solana as a strong candidate.
“As the Ether ETF launches, more Ethereum products will be added, Solana launches, and it will never end. The dam broke,” Balchunas said .
Nate Gerasi, president of ETF Store along with Balchunas, echoed the sentiment. He said that SOL ETF will emerge following Bitcoin and Ethereum, and showed the possibility of a spot ETF combining Bitcoin, Ethereum, and SOL ETF.
“We are moving quickly toward an index-based, actively managed cryptocurrency ETF,” Geraci said .
Explore the SOL ETF Outlook
So far, only VanEck and 21Shares have applied to list financial products. Matthew Siegel, the former's head of research, explained the approval steps for the Solana ETF. Optimism is fueled by the belief that Sol shares Ethereum's fundamental principles of decentralization and blockchain characteristics.
“At this point, we have concluded that Ethereum and Solana are fundamentally identical. No single entity can control more than 20% of Solana, nor can any single entity unilaterally halt the chain. Solana is a utility product that provides access to the second largest open source app store,” Siegel said in an interview with Thinking Crypto’s Tony Edwards.
The Chicago Board Options Exchange (CBOE) also raised the possibility by submitting Form 19b-4s for the Solana ETF. The form requested public comment, a critical step in the SEC's evaluation process.
Still, while the outlook for the Solana ETF has changed in recent weeks, we can't ignore the regulatory hurdles Solana may face before approval.
“The ambiguity surrounding regulatory definition and enforcement has significant implications for Solana ETF approval,” the Bitfinex blog noted .
Coin Bureau CEO Nick cited the lack of a CME futures market, which the SEC typically requires.
Read More: Solana (SOL) Price Prediction 2024/2025/2030
It is still unclear whether the Solana ETF will hit the market soon. If that happens, the highly volatile SOL-based meme coin craze could end with increased regulation. There is currently enthusiasm for the Solana ETF, with prices up 10% over the past seven days and up 1.2% since Wednesday's open. According to CoinGecko data, it is outperforming both Bitcoin and Ethereum.
