The altcoin market is making significant inroads into traditional finance, with the recent launch of the first Solana ETF on the Cboe BZX stock exchange in Chicago.
Named the REX-Osprey SOL and Staking ETF, this fund is designed for investors looking to gain exposure to Solana. In addition to tracking Solana’s price movements, the fund also offers a variable monthly dividend, currently set at 7.3%.
Solana ETF Launch Fuels 2% Price Surge
Following this Solana ETF debut on Wednesday, SOL’s price surged by 2%, reaching around $152, while the investment vehicle attracted about $20 million in inflows by midday, as noted by Greg King, CEO of REX Financial.
This launch marks a notable shift in how retail investors can access cryptocurrency assets, particularly at a time when many brokerages, such as Vanguard, do not facilitate direct purchases on crypto exchanges.
The emergence of cryptocurrency ETFs, which serve as traditional market wrappers for digital assets, is increasingly appealing to both individual and institutional investors.
Initially perceived as niche products, the introduction of Bitcoin and Ethereum ETFs last year have notably paved the way for broader acceptance of the crypto market, culminating in the arrival of Solana’s fund.
These ETFs not only provide a means for new investors to enter the crypto space but also allow for portfolio diversification without the need to navigate the complexities of direct cryptocurrency purchases.
95% Approval Rate For New Crypto ETFs
For years, the US Securities and Exchange Commission (SEC) stymied the launch of spot Bitcoin ETFs, citing concerns over potential market manipulation.
However, a pivotal ruling in October 2023 deemed the SEC’s rejections of Grayscale’s application for a Bitcoin ETF “arbitrary and capricious,” leading to a wave of new products in early 2024.
Major financial players, including BlackRock, Fidelity and VanEck, entered the market with their own spot Bitcoin ETFs, contributing to an influx of nearly $50 billion into these investment vehicles.
Following the success of Bitcoin ETFs, BlackRock and other firms rolled out Ethereum ETFs in July 2024, prompting additional applications for various other cryptocurrencies such as XRP, Cardano (ADA), and Litecoin (LTC), with Solana included.
King noted that under a more favorable regulatory environment with President Donald Trump’s approach toward digital assets, a significant increase in ETF approvals from the SEC could be expected, particularly as the financial landscape shifts with the current administration.
As reported by Bitcoinist on Tuesday, Bloomberg Intelligence analysts James Seyffart and Eric Balchunas have raised their projections for the approval of single-asset spot crypto ETFs, now estimating a 95% chance of approval by the end of 2025.
Seyffart expressed optimism about a forthcoming wave of new exchange-traded funds in the latter half of 2025, signaling a transformative period for the integration of cryptocurrency into mainstream finance.
Featured image from DALL-E, chart from TradingView.com
