The ETF Wave Has Finally Reached Solana!
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Recently, the cryptocurrency exchange-traded fund (ETF) market has been exceptionally lively, with a flurry of hot news attracting widespread attention and sparking heated debates.
The latest data shows that BlackRock, the world's largest asset management company, has expanded its lineup, becoming the company with the most Crypto ETFs. According to Coinglass data, BlackRock's IBIT asset management scale has reached $17.243 billion, ranking first among the 11 Bitcoin spot ETF products.
Since July 23, when the U.S. SEC approved the first Ethereum spot ETF, the crypto world has reached a new milestone, and positive sentiment has once again spread across the market. According to the latest data from Farside Investors, Ethereum spot ETFs have seen inflows exceeding $2 billion in the past four weeks, not including the nearly $2.5 billion outflow from Grayscale's ETHE.
According to Bloomberg Senior ETF Analyst Eric Balchunas, global ETF flows have reached $911 billion year-to-date. The $17 billion net inflow registered by U.S.-traded spot Crypto asset ETFs accounts for nearly 2% of the global total.
Returning to the topic of ETFs, it is said that the approval of the Ethereum spot ETF is a significant milestone in crypto history.
The successful launch of the Ethereum spot ETF has not only provided investors with a convenient and compliant way to participate in the Ethereum market but has also sparked widespread interest and recognition of cryptocurrency ETFs globally. This has significantly accelerated the process for other cryptocurrency spot ETFs, such as the application and approval process for the Solana spot ETF.
1. Overview of the Solana Spot ETF
The Solana Spot ETF, or Solana Exchange-Traded Fund, is an investment tool that tracks the price performance of Solana (SOL). It allows investors to indirectly invest in Solana by purchasing ETF shares without needing to directly hold and manage the cryptocurrency. This investment approach lowers the barriers and risks associated with crypto investing, enabling more investors to participate.
2. Developments in the Solana Spot ETF
On August 8, 2024, the Brazilian Securities and Exchange Commission officially approved the world's first Solana Spot ETF, issued by QR Asset and managed by Vortx, marking a boost in Solana's credibility and legitimacy in traditional financial markets. Subsequently, on August 21, Brazil approved a second Solana Spot ETF, launched by Hashdex in collaboration with local investment bank BTG Pactual.
Despite the breakthrough of the Solana Spot ETF in Brazil, approval in the U.S. market still faces many challenges. In June 2024, asset management giants VanEck and 21Shares submitted S-1 applications to the U.S. Securities and Exchange Commission for a Solana Spot ETF. On July 8, 2024, the Chicago Board Options Exchange, on behalf of VanEck and 21Shares, submitted 19b-4 filings to the SEC.
During the approval process, the Solana Spot ETF encountered regulatory hurdles. Eric Balchunas revealed that the U.S. Securities and Exchange Commission rejected the 19b-4 filings for the two potential Solana Spot ETFs submitted by the Chicago Board Options Exchange, causing the approval process to be interrupted.
Industry analysts emphasize that the approval of the Solana Spot ETF in the U.S. largely depends on political factors. If former President and Republican candidate Donald Trump wins the election, the likelihood of approval could increase.
Everything is still speculative, and the final deadline for the Solana Spot ETF is mid-March 2025. It is worth staying patient for the final outcome.
3. Outlook If Approved
Given the SEC's earlier concessions with Ethereum this year, the market is speculating whether the agency might adopt a similar lenient approach toward Solana. So, if the Solana Spot ETF gets approved, what impact would it have on the broader market?
The launch of the Solana Spot ETF would draw more attention from traditional investors and institutions to Solana and its ecosystem, potentially leading to significant capital inflows.
According to a recently released in-depth assessment by GSR, the projected inflows for the Solana Spot ETF show significant differences compared to Bitcoin under various market conditions—bearish, baseline, and ideal scenarios. In a bear market, the proportion is expected to be 2%, while in baseline and ideal scenarios, it could rise to 5% and 14%, respectively.
The report optimistically forecasts that during a bear market, the price of Solana (SOL) could achieve approximately 1.4 times growth. In a more stable baseline scenario, its growth potential could surge to 3.4 times, and under the most ideal market conditions, SOL's increase could reach an astounding 8.9 times.
4. How to Participate in the Solana Ecosystem
According to publicly available data, the Solana ecosystem is showing remarkable growth. In just four years since its mainnet launch, the ecosystem has rapidly expanded, bringing together over 700 decentralized applications (dApps).
On Wall Street, there's a saying: "Buy on the rumor, sell on the fact." This phrase brilliantly captures the art of seizing market opportunities and adjusting strategies—acting decisively when market rumors first surface and then adjusting positions to lock in profits once these rumors become confirmed facts.
When it comes to positioning within the Solana ecosystem on MEXC, users can flexibly apply this strategy. Given that the platform has deeply integrated the Solana sector, gathering over 80 token projects across various fields, MEXC offers not only spot trading pairs for SOL but also supports trading of other tokens within the Solana ecosystem, such as CHAT, GOL, and SOLAMA. Users can keenly capture market movements and seize potential opportunities in real time. Additionally, MEXC is committed to providing low transaction fees, helping users save on trading costs to the greatest extent. Enter MEXC’s low-fee trading paradise and let every operation become a profit accelerator! Join MEXC to unlock unlimited trading potential and achieve exponential growth in your assets.
If you prefer futures trading, you can opt to earn profits from price fluctuations. MEXC's futures have long been renowned their "top liquidity worldwide," offering faster trades, narrower spreads, and more stable transactions. In the SOL USDT-margined contract, the trade volume within a 0.05% (5 bps) price range far exceeds that of competitors.
Regardless of the outcome of the Solana Spot ETF application, the trend of the crypto industry increasingly integrating into the mainstream financial system is unstoppable. In retrospect, 2024 may be remembered as a pivotal milestone in the development of the crypto industry, marking its profound penetration and integration into the broader financial realm.
Disclaimer: This information does not provide advice on investment, taxation, legal, financial, accounting, consultation, or any other related services, nor does it constitute advice to purchase, sell, or hold any assets. MEXC Learn provides information for reference purposes only and does not constitute investment advice. Please ensure you fully understand the risks involved and exercise caution when investing. The platform is not responsible for users' investment decisions.