SOL Price rises 8 Percent as Bitcoin ETF Issuer VanEck files for Solana ETF in the US
Bitcoin ETF issuer VanEck, one of the first issuers of spot Bitcoin exchange-traded funds (ETF) in the United States, has filed for an ETF that would track the price of Solana.
On June 27, Matthew Sigel, head of VanEck's digital assets research, revealed on X that the company had submitted its application to the U.S. Securities and Exchange Commission (SEC) for the first Solana exchange-traded fund (ETF).
Sigel expressed his excitement and shared some thoughts on why the company believes SOL is a commodity. Giving reasons why the company filed for a new Solana ETF, Sigel said Solana, an open-source blockchain software competitor to Ethereum, is designed to manage a range of applications, such as trading, social interactions, gaming, and payments.
“With its unique blend of scalability, speed, and affordability, the Solana blockchain—which functions as a single global state machine with no sharding or layer 2s—may provide a better user experience for a wide range of use cases.”
We think Solana stands out as a powerful and user-friendly blockchain software because it allows thousands of transactions per second with minimal fees and uses an advanced security mechanism that combines proof-of-history and proof-of-stake technology. We believe that Solana's strong community, low fees, robust security, and high throughput make it a desirable choice for an exchange-traded fund that exposes investors to an innovative and versatile open-source ecosystem.
Sigel, emphasizing why SOL is a commodity, said, “We think that SOL, the native token, works in a similar way as other digital commodities like ETH and bitcoin. On the blockchain, it's used to pay for computational services and transaction fees. It can be traded on digital asset exchanges or utilized in peer-to-peer transactions, just like ether on the Ethereum network.”
He further stated that SOL's utility and value as a digital commodity are highlighted by the wide range of applications and services that the Solana ecosystem supports, from non-fungible tokens (NFTs) to decentralized finance (DeFi).
The decentralized nature of SOL, along with its high utility and economic feasibility, makes it comparable to other well-established digital commodities. This further supports our belief that SOL could be a valuable commodity for investors, developers, and entrepreneurs who are seeking alternatives to the duopoly app stores, he added.
Nate Geraci, president of The ETF Store, Inc., a fee-based investment advisor providing clients with low-cost, diversified portfolios comprised primarily of exchange-traded funds, was surprised that VanEck filed for a spot SOL ETF. He stated that it was a smart move in his opinion, and there was no reason not to get the process underway.
Whoa... VanEck files for spot sol ETF...
— Nate Geraci (@NateGeraci) June 27, 2024
Smart move IMO. No reason not to get process underway. pic.twitter.com/ju2PEqNs8O
As stated in the company's S-1 registration statement, the VanEck Solana Trust would "hold SOL and will value its shares daily based on the reported MarketVectorTM Solana Benchmark Rate" in addition to listing on the Cboe BZX Exchange, Inc.
The native token's value skyrocketed quickly after the announcement. According to CoinMarketCap, the SOL token's 24-hour gain reached nearly 8%.
This announcement comes after spot ETFs for Ethereum and Bitcoin were approved by the U.S. Securities and Exchange Commission. Although some analysts think that could happen as soon as next week, the agency approved 19b-4 forms for spot Ethereum ETFs last month. However, those forms still need to be approved as registration statements before they can start trading.
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