JPMorgan: Approval Chances for Solana and Other Crypto ETFs Remain Low
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JPMorgan: Approval Chances for Solana and Other Crypto ETFs Remain Low
Some commentators are also optimistic about the chances of a Solana ETF being approved.
Navigating Web3 tides with focused insightsSource: cryptoslate
Compiled by: Blockchain Knight
Nikolaos Panigirtzoglou, Managing Director and Global Market Strategist at JPMorgan Chase, said that ETFs for Solana and other assets are unlikely to gain approval.
On May 27, Panigirtzoglou stated in a note to The Block that the SEC's recent decision to approve spot Ethereum ETFs was "already stretched."
Despite the approvals, it remains unclear whether the SEC considers ETH to be a security or a commodity.
According to Panigirtzoglou, this lack of clarity casts doubt on other assets: "We believe the SEC will not go further to approve ETFs for Solana or other tokens."
He added, "The SEC’s view is that tokens beyond BTC and ETH should all be classified as securities," which is a stronger stance than its position on ETH itself.
Panigirtzoglou acknowledged that U.S. lawmakers could pass legislation classifying most crypto assets as non-securities, but he noted such legislation currently does not exist.
Some commentators, however, remain optimistic about the chances of a Solana ETF being approved.
Crypto investor Brian Kelly believes the approval of ETH ETFs could increase the likelihood of a Solana ETF being approved, though he also acknowledges that SOL being classified as a security is a "potential issue."
Bloomberg ETF analyst James Seyffart expects that with legislative efforts like FIT21 clarifying distinctions between securities and commodities markets, a Solana ETF could succeed within a few years. Nevertheless, Seyffart also sees Solana’s potential classification as a security as a key challenge.
Polymarket reports that the probability of the SEC approving a Solana ETF by the end of 2024 is around 13%.
Regardless of future developments, the SEC has previously classified Solana and other tokens as securities in multiple enforcement actions.
In its lawsuit against Coinbase, the SEC stated that Solana is one of many tokens offered as investment contracts and securities, both in past and ongoing sales.
The regulator emphasized that Solana Labs’ $23 million “Simple Agreement for Future Tokens” (SAFT) is an example of a securities offering and sale. The SEC has similarly labeled Solana as a security in cases against Binance and Kraken.
However, the SEC has not directly initiated enforcement proceedings against Solana Labs or related parties.
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