21Shares, an investment firm, has filed an S-1 form with the Securities and Exchange Commission (SEC) to launch a Solana (SOL) exchange-traded fund (ETF), following their competitor VanEck’s filing. This marks the second SOL ETF application in as many days, confirming analysts’ predictions that VanEck’s June 27 filing would prompt other firms to follow suit.
Zurich-based 21Shares currently oversees a physically-backed Solana Staking exchange-traded product with over $846 million in assets under management, along with a bitcoin ETF trading on the Cboe BZX Exchange.
The proposed 21Shares Core Solana ETF, similar to the VanEck Solana Trust, is set to trade on the Cboe BZX Exchange. Like other exchange-traded products for spot-market commodities, redemptions for this fund will be made in-kind, using SOL instead of cash.
The fund’s assets will be stored in segregated wallets on the Solana Blockchain. The fund will not engage in validating or staking SOLs. The intra-day value of shares will be calculated every 15 seconds. The amount of SOL in the fund will be calculated every day at 4:00 p.m. ET.
According to Andrew Jacobson, head of legal at 21Shares, the firm is intrigued about the prospect of a Solana-focused ETF established in the United States. He noted that this is an important move for the crypto business and matches with their mission to provide easily accessible financial solutions based on crypto assets.
Despite growing interest from issuers, legal experts said that SOL ETFs might face challenges in getting SEC approval due to the absence of a regulated futures market for SOL and the SEC’s previous ruling that it is a security. However, Jacobson remains hopeful, stating that including a crypto token in a CME futures contract should not be the only criterion for ETF eligibility.
On May 31, 21Shares filed for a spot ETH ETF, named the 21Shares Core Ethereum ETF after ARK Invest ended their partnership on the application. The SEC approved the ARK 21Shares spot ETH ETF 19b-4 filing on May 23. Initially, the partners intended to offer an ETH ETF with staking but later revised their plans.
The quick filing by 21Shares for a Solana ETF following VanEck highlights the competitive race in the crypto ETF market. This trend may prompt more firms to join, boosting mainstream adoption and regulatory focus.
