Solana ETF launches this week! Bitwise BSOL listed on the New York Stock Exchange, causing a wave of institutional Coin Hoarding on Wall Street.

Bitwise plans to launch the Bitwise Solana Staking ETF on October 28 on the New York Stock Exchange, making it the first exchange-traded product in the United States to invest 100% directly in Spot SOL. The company announced on the X platform that this Solana ETF is the first of its kind, marking the official entry of SOL into the institutional investor allocation space.

Bitwise BSOL becomes the first 100% Spot SOL ETF in the United States

(Source: X)

On October 27, Bitwise published an article on the X platform stating that it will launch the Bitwise Solana Staking ETF on Tuesday at the New York Stock Exchange, which is the first of its kind, with the stock code BSOL. The company stated that this is the first ETP (exchange-traded product) to “directly invest 100% in Spot SOL.” This description of “100% direct investment” is extremely critical, meaning that BSOL does not use futures or derivatives but actually holds Solana tokens.

More importantly, this Solana ETF also incorporates staking features. Solana, as a Proof of Stake (PoS) blockchain, allows token holders to participate in network security maintenance through staking and earn staking rewards. The staking characteristics of BSOL mean that ETF holders can benefit not only from the price increase of SOL but also earn an annualized staking yield of about 5% to 7%, making it more attractive compared to an ETF that simply holds SOL.

Bitwise stated: “Solana is moving towards the mainstream - we believe this is just the beginning.” This statement reflects the company's strong confidence in the long-term prospects of Solana. As a professional institution managing billions of dollars in cryptocurrency assets, Bitwise's judgment holds significant reference value. The company's previously launched Bitcoin and Ethereum ETFs have achieved commercial success, and its bet on the Solana ETF indicates its optimism about Solana's appeal among institutional investors.

Christine Smith, Director of the Solana Policy Institute, discussed the significance behind this release. In a statement, Smith said: “The launch of the first Solana ETP Spot BSOL in the United States indicates a widespread recognition of Solana's role as a key financial infrastructure for the future digital economy. The global financial framework is being rebuilt around Solana, and investors can now utilize it.”

Core Features of BSOL:

100% Spot Holdings: Directly holding Solana tokens, rather than futures or derivatives.

Staking Yield: Earn approximately 5-7% annual yield by staking SOL.

Listed on NYSE: Trade on the world's largest stock exchange, ensuring liquidity.

Institutional Custody: Professional custody services ensure asset security.

High transparency: Daily disclosure of holdings and NAV (Net Asset Value)

This week's series of launches, Solana ETF triple release

At the same time, other companies are also planning to launch a series of cryptocurrency ETFs. Canary Capital stated that it plans to list its Litecoin ETF and HBAR ETF on Nasdaq on Tuesday. Grayscale Solana Trust ETF is scheduled to launch on Wednesday. This intense rollout pace indicates that the cryptocurrency ETF market is experiencing a period of explosive growth.

The launch of Grayscale Solana Trust ETF on Wednesday adds a competitive dimension to the Solana ETF market. Grayscale is a long-established institution in the cryptocurrency asset management field, and its Bitcoin Trust (GBTC) was the largest cryptocurrency investment product before converting to an ETF. Grayscale's entry into the Solana ETF market will form direct competition with Bitwise, which may drive down management fees and foster product innovation.

On Monday, Kyle Samani, the managing partner of Multicoin Capital, announced the launch of the Bitwise SOL Staking ETF on X, but later deleted the post. Multicoin Capital is an important investor in the Solana ecosystem, and the attention of its managing partner to this Solana ETF (even after deleting the post) also shows the industry's high regard for this product.

Three Solana ETFs were launched consecutively in two days. This concentrated release may distract investors' attention or may create a synergistic effect. From a positive perspective, the simultaneous listing of multiple Solana ETFs will significantly increase Solana's exposure in mainstream financial markets, attracting more institutional investors' attention. From a competitive standpoint, Bitwise's first-mover advantage may allow it to attract most of the early capital inflow, while Grayscale's brand recognition may play a role in the later stages.

Government shutdown leads SEC to streamline process and expedite approvals

Due to Congress's failure to approve funding, the U.S. government has been shut down for nearly two months. This means that the Securities and Exchange Commission (SEC) will continue to operate under its shutdown plan, which greatly restricts the scope of work for employees as many are forced to take leave. However, after a week of the shutdown, the SEC released guidance clarifying the procedures for companies seeking to go public.

According to informed sources, the SEC stated in its guidance that if a company wishes to go public, it can submit an S-1 registration statement without the so-called delay amendment. The delay amendment means that the ETF will not take effect after 20 days, giving the SEC time to process the opinions of all parties. When a company submits its final S-1 document, it means that it can take effect within 20 days.

This policy change is highly revolutionary. In the past, cryptocurrency ETF applicants typically needed to go through multiple rounds of communication and revisions with the SEC, and the entire process could take months or even years. The Bitcoin Spot ETF went through nearly ten years of repeated negotiations from its initial application to final approval. Now, the clear 20-day timeline has significantly reduced uncertainty, allowing the Solana ETF to smoothly launch even during government shutdowns.

Before shutting down the exchange, the SEC approved listing standards proposed by three exchanges, requiring the agency to modify a rule governing the trading and listing of commodity trust shares. This approval means that dozens of cryptocurrency ETF applications can go live more quickly. A knowledgeable source previously stated that companies hoping to launch cryptocurrency ETFs without SEC approval need to meet listing standards.

To launch a cryptocurrency ETF, the company needs a final S-1 registration statement and an 8-A form, some of which have already started to arrive. It is currently unclear how many issuers are going through this process and how many cryptocurrency ETFs may be launched soon, but the market generally expects a wave of ETF launches in the coming weeks.

Potential Impact of Solana ETF on SOL Price

The launch of this Solana ETF may have a multifaceted impact on the price of SOL. In the short term, the listing of the ETF typically triggers a “buy the rumor, sell the news” sell-off, as many investors buy in anticipation of the ETF's approval and choose to take profits once the news is confirmed. However, in the medium to long term, the institutional capital inflow brought by the ETF will provide continuous buying support for SOL.

The experience of Bitcoin ETFs shows that within a few months after launch, sustained capital inflows drive the price of Bitcoin up by more than 50%. If the Solana ETF can replicate a similar pattern, the price of SOL may see a significant increase in the first quarter of 2025. Currently, the trading price of Solana is about $190, and if we refer to the effects of the Bitcoin ETF, the target price could reach the range of $250 to $300.

The addition of the staking feature adds extra appeal to the Solana ETF. Traditional investors may not be familiar with the concept of staking, but when they realize that holding BSOL not only allows them to benefit from price appreciation but also to earn stable staking returns, this “earning money while lying down” model will be highly attractive. An annual staking return of 5% to 7% is highly competitive in the current low-interest rate environment, far exceeding the yield on U.S. Treasury bonds.

However, investors also need to be aware of the risks. The Solana ETF may face issues with insufficient liquidity and wider bid-ask spreads when it first launches. Additionally, management fees are also a consideration; Bitwise has not yet disclosed the specific fee rate for BSOL, but referencing other cryptocurrency ETFs, the annual management fee may range from 0.2% to 0.95%. Investors need to weigh convenience against cost.