VanEck Chooses Solana Over XRP for Spot ETF Filing, Citing Comparable Blockchain Characteristics and Decentralized Nature

In an interview with Tony Edwards of Thinking Crypto, Matthew Sigel, Head of Digital Assets Research at VanEck, explained the firm's decision to file

Investment management firm VanEck has filed for a spot Solana Exchange Traded Fund (ETF) with the Securities and Exchange Commission (SEC). The move aligns with the firm's strategy to introduce a Solana ETF in the US, following the launch of a futures-based ETF in March.

In an interview with Tony Edwards of Thinking Crypto, Head of Digital Assets Research at VanEck, Matthew Sigel, explained the firm's decision to pursue a spot Solana ETF over one based on XRP.

Solana's Similarity to Ethereum

Highlighting the parallels between Solana and Ethereum, Sigel stated, “When we looked at our Ethereum filing and examined the language around decentralization and characteristics of the blockchain, and then refreshed our deep dive on Solana, we concluded that the ETH and SOL assets at this point are fundamentally the same.”

This similarity pertains to the decentralized nature of both blockchains, with no single entity having the ability to control more than 20% of the outstanding Solana tokens or halt the chain unilaterally.

According to Sigel, this decentralization is a crucial aspect, as the SEC often emphasizes the lack of centralized control in its assessments of crypto assets. By aligning Solana closely with Ethereum in these respects, VanEck aims to position the Solana ETF as a viable commodity, similar to Ethereum, in the eyes of regulators.

Solana Futures Market and ETF Approval

Discussing the absence of a significant regulated futures market for Solana, which is often cited as a requisite for ETF approval, Sigel expressed optimism based on analogies with other markets.

“Frankly, we think that the focus on that regulated market of significant size—the Futures Market—is a gentler scope. There are other ETFs in the market without a futures market of significant size like power, shipping, and uranium markets, where the futures market is just immaterial to the price formation in those markets,” he stated.

Sigel suggested that such precedents could pave the way for a spot Solana ETF, though he conceded that approval might be easier under a different SEC chair, hinting at potential regulatory changes post-US elections.

SEC's Schizophrenic Approach to Crypto Regulation

Sigel also commented on the broader regulatory environment, particularly the ongoing legal challenges between the SEC and various crypto companies, including high-profile cases involving Coinbase and Ripple.

He described the situation as “schizophrenic” due to conflicting outcomes in recent court decisions. For instance, federal judges have recently ruled that secondary sales of certain crypto assets like XRP or BNB do not constitute securities transactions and do not fit under the Howey test.

“The XRP and BNB ruling are very positive for the Coinbase suit,” Sigel asserted, suggesting that these precedents could influence the outcome of other ongoing legal battles involving crypto assets.

Internal Conviction, Customer Demand Hinder XRP ETF Prospects

When asked about the possibility of launching an ETF based on XRP, Sigel was notably cautious. He outlined the complex layers of decision-making that influence the introduction of new ETFs in the crypto sector.

“In order to bring an ETF to market, you have to have several different stakeholders on board,” Sigel explained, emphasizing the necessity of alignment among regulators, issuers, market infrastructure providers, and end consumers.

“You have to have counterparties like exchanges, market makers, custodians who also rally behind the asset and then you have to be able to find customers who want to buy it,” Sigel stated.

For XRP, Sigel identified significant obstacles in two key areas: internal conviction and customer demand. “When we think about XRP, we’re missing a few of them: internal conviction and customer demand. So I’d say that one is less likely,” he remarked.

VanEck's Crypto ETF Ambitions in the US

Looking ahead, Sigel hinted at broader ambitions for crypto ETFs, referencing VanEck's existing products in Europe. “If you look at our ETF lineup in Europe, we have a top crypto product which is the top five assets and then we have a smart contract leaders ETF which is top five layer-ones,” he noted.

This indicates a strategic roadmap for potentially introducing similar products in the US, contingent on regulatory approval and market conditions.

“It really is going to require clarity around first and foremost that the SOL ETF. Can we get it to the market and then I think issuers will try with the other proof of stake coins and then, you know, the building blocks will be put together and someone will do a top 5 [or] top 3 [ETF],” Sigel concluded.

The above is the detailed content of VanEck Chooses Solana Over XRP for Spot ETF Filing, Citing Comparable Blockchain Characteristics and Decentralized Nature. For more information, please follow other related articles on the PHP Chinese website!