BlackRock, the prominent issuer of Bitcoin and Ethereum exchange-traded funds (ETFs), has yet to make any plans to launch an ETF for the Solana blockchain.
This announcement comes from two senior executives, quashing recent speculation about a potential Solana ETF.
Solana’s current market performance
Despite Solana’s strong performance, which is nearing its annual high, BlackRock remains uninterested in a Solana ETF. However, other asset managers, such as VanEck, have already submitted an application to the US Securities and Exchange Commission (SEC) for a Solana ETF.
During an interview on Bloomberg TV, Samara Cohen, BlackRock’s CIO of ETF and Index Investments, clarified the firm’s stance. She cited client demand and the ‘inevitability’ of assets as key factors in their decision-making process. Cohen emphasized that Bitcoin and Ethereum meet the criteria for an ETF, while Solana does not. She stated:
“Not in the near term. We look at the instability to see what meets the criteria, meets the bar, to be delivered in an ETF. For us, both due to instability considerations and what we hear from our clients, BTC and ETH meet that bar. It will be a while before we see anything else.
Robert Mitchnick, BlackRock’s Head of Digital Assets, echoed this sentiment at the Bitcoin Conference 2024. Mitchnick highlighted several reasons why a Solana ETF is not feasible now, including the blockchain’s maturity, liquidity, and market capitalization. He noted:
“I don’t think we’ll see a long list of crypto ETFs. If you think of Bitcoin, it represents about 55% of the market cap today. ETH is at 18%. The next plausible investible asset is at, like, 3%. It’s not close to being at that threshold or track record of maturity, liquidity, et cetera.”
Differing opinions on Solana’s potential
Not everyone agrees with BlackRock’s assessment. Nate Geraci, president of ETF Store, pointed out that exchange-traded products for digital assets like Solana are already available in Europe. However, he acknowledged that significant regulatory changes would require launching similar products in the US.
The discussion around a potential Solana ETF has impacted the asset’s recent rally. SOL experienced a drop of over 6% after a previous rise of nearly 10%. The token’s price increased
from $182 on June 28 to $193.66 on June 29 but fell back to $181.84. This volatility may also be linked to the broader market decline following the US government’s movement of approximately $2 billion in Bitcoin to Coinbase, which signaled a potential sell-off.
Investors Bullishness on Solana (Source: CoinGecko)
Despite these fluctuations, Solana remains one of the year’s top performers, with a 32% increase over the past 30 days and a 66% appreciation year-to-date. A recent CoinGecko survey revealed that most investors are optimistic about Solana’s future, with 25% expecting it to reach $300 in this cycle. However, only 10.6% of respondents believe it could hit $1,000.