Solana EFT Incoming? SEC Unlikely to Approve, Says JPMorgan

The SEC’s recent approval of Ethereum ETFs may not extend to Solana and other cryptocurrencies, according to JPMorgan’s market strategist.

Robot welding a Solana ETF coin surrounded by smoke.
Created by Gabor Kovacs from DailyCoin
  • JPMorgan doubts SEC approval for Solana ETFs.
  • SEC approved spot Ethereum ETFs recently.
  • Other analysts believe Solana could be first in line for ETF. 

The SEC’s recent approval of spot Ethereum Exchange Traded Funds (ETFs) has raised high hopes in the Solana community. Some analysts suggest that SOL would be first in line after Bitcoin and Ethereum. 

However, not all agree that the SEC has sufficiently changed its stance. JPMorgan, a leading global financial services firm, expressed doubts about the SEC’s willingness to approve similar ETFs for other cryptocurrencies, including Solana.

Solana Faces Significant Barriers to SEC Approval

On May 23, the SEC approved spot Ethereum ETFs for several major firms, including Grayscale, Bitwise, and BlackRock. This decision came after months of stalled talks, with some suggesting that the agency buckled under political pressure. 

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Despite this progress, Nikolaos Panigirtzoglou, Managing Director and Global Market Strategist at JPMorgan has voiced skepticism about the SEC extending this approval to other cryptocurrencies like Solana. Panigirtzoglou noted that the SEC’s stance that most cryptocurrencies are securities remains a significant barrier.

 “The decision by the SEC to approve ETH ETFs is already stretched given the ambiguity about whether Ethereum should be classified as a security or not,” Panigirtzoglou explained. We don’t think the SEC would go even further by approving Solana or other token ETFs given the SEC has stronger opinions that tokens outside Bitcoin and Ethereum should be classified as securities,” he added.

Why SEC Changed Its Perspective on Spot ETFs

A key factor in the SEC’s shift was substantial pressure from U.S. lawmakers. A bipartisan group from the House Financial Services Committee, led by Rep. French Hill, sent a letter to SEC Chair Gary Gensler urging the approval of spot Ethereum ETFs. The lawmakers argued that approving Bitcoin ETFs earlier set a precedent that should logically extend to Ethereum.

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Earlier in the year, the decision to approve the Bitcoin ETF was forced on the SEC by the courts. A federal court ruled against the SEC in a case concerning the approval of spot Bitcoin ETFs, setting a legal precedent that forced the SEC to reconsider its stance on similar applications.

Despite JP Morgan’s skepticism, other analysts believe Solana has a good case for ETF approval after the SEC’s decision on Ethereum. Bloomberg analyst James Seyffart noted that the same case that was made for Ethereum applies to other cryptos. 

Seyffart expects the demand for Solana ETFs to outpace that for other altcoins. However, he acknowledges the regulatory issues, stating that a Solana ETF is likely beyond 2026 unless Congress intervenes. 

On the Flipside

  • Despite Ethereum’s success in winning the SEC’s approval, analysts doubt these products will attract similar attention to Bitcoin spot ETFs. 
  • Ripple recently hinted at its own bid for ETF approval. However, the project’s longstanding litigation with the SEC might prevent it.  

Why This Matters

The potential SEC’s approval of a Solana ETF would be a major development for the token, strengthening its legitimacy among the top crypto projects.

Read more about ETH spot ETFs and their potential market impact: 
Why Ethereum Spot ETFs Will Not Mirror Bitcoin’s Success

Read more about Sei V2’s latest integration: 

Sei V2 Integrates Pyth and Entropy for Better DeFi Performance

This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed as financial, legal, or tax advice. Trading forex, cryptocurrencies, and CFDs pose a considerable risk of loss.

Author
David Marsanic

David Marsanic is a journalist for DailyCoin who covers the intersection of crypto, traditional finance, and government. He focuses on institutionalized crypto entities like major cryptocurrency exchanges and Solana, breaking down complex topics into easy-to-understand writing. David's prior experience as a business journalist at various crypto and traditional news sites has enabled him to maintain a critical approach to news while adhering to high journalistic integrity standards.