Canary Capital Files Application With the U.S. SEC to Launch a Spot Solana ETF

Amid rising demand for crypto ETFs, Canary Capital filed an application with the U.S. SEC to launch a spot Solana ETF.

Nashville-based Canary Capital has filed an application with the U.S. Securities and Exchange Commission (SEC) to launch a spot Solana exchange-traded fund (ETF). If approved, the ETF would provide investors with exposure to the Solana blockchain without having to directly purchase or store SOL tokens.

The move comes as part of a broader effort by asset managers to expand the range of crypto-linked ETFs available to investors. Earlier in October, Canary filed for spot ETFs for both XRP and Litecoin, while asset managers VanEck and 21Shares submitted similar applications for Solana in June.

Solana has emerged as one of the leading blockchains for decentralized applications (dApps) and DeFi applications, boasting some of the lowest transaction fees and fastest transaction times among major blockchains. Its blockchain is known for its technical efficiency, making it a popular base for many decentralized finance projects, meme coins and NFTs.

According to Canary, Solana is one of the most prospective ETFs due to its large DeFi ecosystem and low-price transaction environment. The firm noted that sustained on-chain activity with an ever-growing user base is driving strong conviction behind institutional interest. Notably, Solana has already passed both Ethereum and Binance Chain in terms of active address market share—even with Ethereum’s Layer 2 solutions included in the platform.

However, the SEC has taken a cautious approach towards cryptocurrency ETFs, especially those tracking assets other than Bitcoin and Ethereum. In past cases, such as its lawsuit against Binance in 2023, the regulatory body has classified SOL as a security, presenting additional challenges for Solana-focused products.

While the SEC has shown a willingness to approve ETFs for Bitcoin and Ethereum, analysts suggest that it may be more hesitant to greenlight products for less decentralized networks like Solana, given its smaller pool of validator nodes.

Despite these hurdles, Canary's application marks a significant step in the effort to bring Solana into the视野 of institutional investors and traders. A spot Solana ETF would dramatically expand the availability and visibility of SOL, making it easier for investors to gain price exposure to the token through a traditional brokerage account, without the hassle or risk associated with actually buying and storing the digital asset themselves.

In anticipation of an ETF approval, some analysts have pointed out that the news might also influence market sentiment and price action for Solana. According to BeInCrypto analysis, Solana's price experienced a slight dip following Canary's announcement.

Data from Brave New Coin shows that SOL dropped by 3.32% over the past 24 hours, trading at around $175.01 at the time of reporting. After a brief surge, the price encountered a natural correction, ultimately stabilizing in the wake of the announcement.

The next crucial level of resistance for Solana is around the $180 mark, with further potential for upward momentum. As institutional interest and market dynamics continue to unfold, it remains to be seen how these developments will impact Solana's price and the broader crypto market landscape.

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