This week, we have a special guest appearance from Leah Wald, who is sharing her thoughts from DAS NY 2025. This episode will focus on the launch of the Solana Futures ETF in 2025, provide an in-depth analysis of SOL Strategies’ strategy guide, and explore Leah’s unique insights into the current cryptocurrency market. In addition, we will discuss Solana’s long-term vision and its latest industry developments.
Summary of highlights
- In the early history of cryptocurrencies, the largest holders tended to be individual investors.
- Solana’s institutionalization is still in its early stages and more discussions are just beginning.
- Part of Solana’s success has been its ability to start conversations with a variety of institutions and get them to consider implementing blockchain projects on its platform.
- Comparing SOL Strategies to Solana’s Microstrategy is an incomplete analogy, and a fairer approach would be to build a real technology company.
- What I really like about the Solana community is that there are all kinds of startups exploring innovation.
- Like Bitcoin, it took a long time to establish itself as a "store of value". Solana and SOL are more speculative in nature, so they also need time to find their own direction.
The launch of the Solana Futures ETF
Jack:
We just saw the first Solana ETF in the US begin trading. You are an expert in this field, and I would like to ask you, regarding the futures ETF of volatility shares, what do you think of the first-day performance? How is the trading volume? What key points should people pay attention to during this release process?
Leah Wald:
This is very important. I don't think any of us expected things to develop so quickly. This launch comes right after the release of CME futures products, with very fast approval, and also introduces the A2X leverage mechanism.
I think Volatility Shares’ choice to launch futures products is a very wise strategy. The market had a very strong performance on Monday and by all accounts it was a successful demonstration of the market's existence and successful trading. Especially for a product with 2x leverage, this is undoubtedly a huge win. From the perspective of institutional adoption and market effectiveness, it means a lot to the entire ecosystem.
As for trading volume, I think there is still a lot of room for growth, but after all, it is only the first day. Many market participants typically don’t enter the market on the first day, so it’s more important to look at performance three months later, including trading volume, market participation, and overall interest.
Jack:
If I remember correctly, when you were working at Valkyrie, you launched a Bitcoin futures ETF. Can you share your experience at that time? For example, what was the trading volume like on the first day? When did we start seeing large-scale inflows of funds? In addition, what experiences do you think can be applied to the Solana futures ETF from the Bitcoin futures ETF?
Leah Wald:
We launched Valkyrie and ProShares’ Bitcoin futures ETF in October 2021. ProShares went live two days before us, and they chose to list on the New York Stock Exchange (NYSE), while we chose NASDAQ. ProShares' product traded over $1 billion on its first day, while our first day traded about $50 million. Nevertheless, this is already a very good result as it is the first Bitcoin ETF in the United States.
The process of launching a futures ETF is very complex, especially in terms of communicating with market makers and ensuring the normal operation of the entire futures trading ecosystem. Compared with spot ETFs, futures ETFs involve more participants. At the same time, because it is based on paper trading on CME, there is a certain separation between it and spot assets, so additional considerations are required in terms of tracking errors and other aspects.
Even though Bitcoin has larger AUM and trading volume, the market situation is indeed different. People have more time to prepare. It looks like the SEC approved the futures two days after they were launched. So volatility stocks still have a chance to start marketing.
Jack:
How long do you think it will take to get a meaningful assessment of trading volumes in CME futures and volatility share ETFs? After all, the trading volume on the first day is usually lower, so does it take longer to observe?
Leah Wald:
Many companies are unable to purchase futures products directly due to internal portfolio limitations. In addition, the range of participants in futures trading is relatively limited. Therefore, the first day’s performance usually does not fully reflect the product’s potential.
I think it will take at least three months to observe the market performance of these ETFs, including changes in trading volume and participation. Typically, trading houses like those in Chicago are major players, and their actions can have a significant impact on market performance. Therefore, a three to nine month time frame is a reasonable period to evaluate the success of these products.
Jack:
What do you think about the prospects of spot ETFs in 2025?
Leah Wald:
I think this is a critical moment to look forward to. Based on historical experience, futures ETFs are usually launched before spot ETFs. Although we cannot make an accurate prediction, the launch of this futures ETF is undoubtedly a positive signal. Currently, many companies have submitted applications for spot ETFs, and their product operations are performing well. So, I am optimistic about the prospects for spot ETFs in 2025.
Are institutions optimistic?
Jack:
Let’s talk more broadly about futures ETFs. Now we are at the DAS conference, and the overall atmosphere here is more like a gathering of institutional investors. However, you and I have talked before about how a lot of people tend to think of “institutions” as a unified whole when talking about crypto.
I have two questions: First, have institutions started to enter Solana? Second, what does this mean for the market? Furthermore, how should we define “institution”? Which ones are considered institutions and which ones are not? From what you’ve observed so far, which areas or market segments are most likely to see institutional capital enter Solana in the short term?
Leah Wald:
This is a question that is worth thinking about. We usually divide ordinary users and institutional investors into two categories, distinguishing them by the size of their funds. But in the history of cryptocurrency, things are not that simple. If we think of ordinary investors as people who manage their own wealth, and institutions as organizations that manage the capital of others, then the two represent different natures of capital flows, not necessarily differences in the size of the funds. In fact, in the early history of cryptocurrencies, the largest holders tended to be individual investors.
As Bitcoin is increasingly seen as a new store of value asset, institutionalization trends are beginning to emerge. For example, financial giants like Blackrock and Fidelity are actively launching Bitcoin ETFs, which marks a huge shift in the market. However, for other Altcoin, such as Solana, current major holders are still individual investors. Although these people are legally called ordinary investors, their capital scale and market influence are actually comparable to institutional investors.
As for your second question, what does the entry of institutions mean to the market? Are they already involved? For Solana, current discussions are more focused on "how" institutions can participate in its ecosystem. We can see some signs, such as Franklin Templeton launching a blockchain-based fund and trying to operate on the Solana platform. In addition, the launch of futures ETFs provides new tools for institutional investors, which may attract more capital into the Solana ecosystem. In the Bitcoin market, we have seen how institutions are making significant asset allocations through endowments, pension plans, and sovereign wealth funds. With Solana also having similar investment tools, we may see more institutional participation.
However, overall, the institutionalization of Solana is still in its early stages, and more discussions are just beginning.
Solana’s Ultimate Vision
Jack:
One issue that may be overlooked is the difference between institutions purchasing SOL assets and institutions putting money market funds on the Solana platform to operate. Compared to the possible on-chain NASDAQ in the future, I think the possibility of pension funds purchasing SOL assets is obviously more realistic.
Leah Wald:
Your point makes sense. It is really interesting to see how different projects develop. I think one of the successes of Solana is that it has been able to start a conversation with a variety of institutions and get them to consider whether to implement blockchain projects on its platform. Solana makes a strong case in this regard because it has many significant advantages. However, how the funds will be allocated after entering the Solana ecosystem and to which areas they will flow are important issues that need to be explored in depth next. Fortunately, as we discussed two days ago, these topics are starting to gain traction.
Jack:
You mentioned the difference between institutions and ordinary investors before, but in fact the size of funds is not the main dividing line between the two, because there are also some so-called "ordinary whales" (individual investors who hold a large amount of assets). Does your SOL Strategies frequently interact with individual investors like Joe who hold a large amount of Solana for the long term? After all, he may have considerable assets under his control.
Leah Wald:
Indeed, this is a very interesting phenomenon. Part of my job is to communicate with investors and share our ideas and story with them. For an investor like Joe, he may be perfectly content holding SOL for the long term, just like many Bitcoin investors who are happy holding their Bitcoin and may discuss the importance of an ETF with us. This choice itself is good, as investors should have a variety of investment options.
Currently, we are the only option that offers stock investment positions to the average investor through an IRA or similar account. This is also an issue worthy of attention in the development of Bitcoin ETF. However, I think an investor like Joe might prefer to hold and stake his Solana assets directly rather than buying our shares immediately. Unless our stocks become more attractive to them or they start to participate more actively in stock trading, this transition may take time.
Laine’s Acquisition Strategy
Jack:
Speaking of your validators, I recently saw an interesting news about SOL Strategies. You acquired Laine Solana validator, I think his name is Michael, he also runs stakewiz.com. This acquisition is very special. I'm wondering how you started the conversation with him? Why did you choose to acquire this particular validator and also bring Michael in as COO? Can you share this story?
Leah Wald:
Frankly speaking, this acquisition was largely due to Michael's personal ability. He is a very good and smart businessman who also has an excellent engineering background, and people like him are indeed very rare. Therefore, discussing with him the acquisition of Laine validators, stakewiz.com and other related assets fits perfectly with our strategic logic for the next phase of external expansion. This acquisition increased our holdings to approximately 3.3 million.
Jack:
This is almost equivalent to doubling your stake, and it seems to be done in a short period of time.
Leah Wald:
Yes, it is true. The effect of Michael joining has been remarkable, and he is widely respected in the Solana community, not only for his ability and intelligence, but also for his sincere commitment to the community. You can also see this focus on the community in the work of our Chief Technology Officer.
For example, we recently supported the SIMD02,2,8 proposal, and although this is not entirely in line with our economic interests as a validator, we still chose to support it because it is more beneficial to the development of the entire Solana network.
Our goal is to build a company that is deeply integrated into the Solana ecosystem and in this way contribute to the long-term development of the Solana network. This is also one of the reasons why we acquired Laine validator.
Is SOL Strategies Solana’s Microstrategy?
Jack:
Has SOL Strategies’ growth plan always been through acquisitions? When I first heard about SOL Strategies, it was described as “Microstrategy for Solana.” I would have thought you would be like Microstrategy, buying large amounts of SOL by issuing debt, and perhaps using staking to earn additional returns, such as staking SOL to platforms like Jito or Helius.
I heard this on the Lightspeed Podcast. However, it now appears that you have moved deeper into the validator space, not only acquiring validators, but Max also frequently tweets his views on the SIMD proposal. And Michael, a well-known figure in the Solana validator community, has also joined your team. So, did you plan this direction of development from the beginning? Or is this a strategy that has evolved over time?
Leah Wald:
Comparing SOL Strategies to Solana’s Microstrategy is actually an incomplete analogy. In my opinion, the limitation of this model is that it simply plays the "net asset value (NAV) game", that is, increasing the value of the company by accumulating assets, but this alone is not enough. I need to think about how to run a real business while creating long-term value for the company's shareholders. It would be unfair to shareholders if the market thought we were just sitting there waiting for SOL to appreciate. I think the fairer approach would be to build a real tech company.
Our strategy is to grow in a slower but more stable manner. In the early stages, we mainly relied on external acquisitions (inorganic growth) to expand our suite business, such as acquiring validators and related assets. Over time, we will gradually shift to natural growth (organic growth) relying on our own capabilities. Our ultimate goal is to become the infrastructure company for Solana.
During this process, we are indeed accumulating as much SOL as possible and staking it to our validator nodes. But this is only part of an overall strategy, similar to how Bitcoin miners increase the amount of Bitcoin on their balance sheets through financing while operating their mining operations. I believe this model is more powerful and meaningful because we are not just “buying SOL” but playing an actual role in Solana’s infrastructure ecosystem. With the help of Max and Michael, we are also actively in dialogue with institutional investors to advance this vision.
Jack:
In addition to operating a validator, are you considering expanding the suite to other infrastructure businesses? Are your goals limited to validators, or are there broader technical directions to explore?
Leah Wald:
We are definitely considering additional opportunities outside of the validator business, particularly in the area of ancillary technologies that support the Solana ecosystem. We are currently in talks with multiple parties to explore more possibilities.
Solana’s Investment Theory
Jack:
What is Solana’s current investment philosophy? You seem to have some sort of liaison with Microstrategy. Michael Saylor plays an important role in the Bitcoin field and can be said to be the "spokesperson" of Bitcoin. I think you guys are trying to do something similar. Now seems to be a turning point. Recently we have seen the popularity of some meme coins fading. For example, Fire Dancer, which was once very popular, now seems to have lost some of its popularity. So, what is your investment thesis for the rest of 2025? What do you think of the Solana network and how are you promoting Solana now?
Leah Wald:
This is a very deep question and can be answered in three parts. I think Solana is finding its niche right now. As a blockchain still in its early stages, it is still working to clarify its role and value proposition. Solana has its own strengths and core pillars that prove it to be more efficient than some other blockchains. But the key question is, to whom are these advantages attractive? Who would choose to build on it? Who will be its users?
In the Solana ecosystem, there is a lot of active discussion around products, such as the concept of "structured products". So, will Solana become a platform that supports on-chain mutual funds? Or, will it evolve into a payment system? These are all possible directions. What I love about the Solana community is that there are all kinds of startups exploring innovation. This year, I hope to see Solana further clarify its market segment. Although it has established core advantages, it has not yet fully found its unique positioning.
This process takes time. Just like Bitcoin, it took a long time to establish itself as a "store of value". Solana and SOL are more speculative in nature, so they also need time to find their own direction. In 2025, I will be watching Solana’s development closely, hoping to see it find its own unique market segment.
Final Thoughts
Jack:
About other ecosystems, such as Sui, other first-layer blockchains (L1), and Ethereum. Honestly, I think there are investment opportunities similar to SOL Strategies in these ecosystems. Why don’t we see more holding companies adopting similar investment strategies? Do you think such companies will emerge in the next year and a half?
Leah Wald:
I think such companies will emerge, and I have already spoken to some that are interested. Overall, I expect we will see many companies go public in the U.S. via IPOs, likely in the form of special purpose acquisition companies (SPACs). In Canada, I think some companies may try to use real-time operating systems (RTOS).
However, as more and more companies of this type emerge, I think the key issue is how to define success. Simply going public does not mean success. True success depends on multiple factors, such as market participation, investor interest, and volume support in the stock ecosystem. This support may come from both the token community and the capital market ecosystem. Therefore, I believe we will see more companies go public, but they need to have more comprehensive strategic thinking rather than just going public for the sake of going public.
I hope to see companies that think more holistically, not just about going public, but thinking long-term. I welcome competition. I think we'll see that happen and expect to see these companies actively participate in building the ecosystem. Only in this way can we truly promote the healthy development of the industry.
