BlackRock Solana ETF Launch Would Undercut Early Applicants, Analyst Warns

As the race to launch a spot Solana ETF in the United States heats up, ETF analyst James Seyffart argues that it would be unfair for BlackRock the world’s largest asset manager to leap into the market at the last minute and debut alongside firms that have already paved the way with months of regulatory groundwork. Seyffart, speaking to NovaDius president Nate Geraci in a recent interview, contends that BlackRock should not benefit from the substantial efforts made by early Solana ETF applicants if it has so far refrained from filing.

Early Applicants Put in the Hard Work

Since June 2024, several U.S.-based asset managers including VanEck, Bitwise, Grayscale, Invesco, 21Shares, CoinShares, Canary Capital, Franklin Templeton, and Fidelity have filed applications for a spot Solana ETF. These firms have spent months navigating regulatory red tape, corresponding with the SEC, and submitting amended applications to address the agency’s legal and compliance concerns. Seyffart emphasizes that these issuers invested significant resources and time “getting the paperwork right” while awaiting a decision from the Commission.

“That’s messed up,” Seyffart said, if BlackRock were to jump in at the final hour and launch their own Solana ETF without having endured the same lengthy regulatory process.

BlackRock’s Strategy: Waiting on Demand?

Although BlackRock has not yet filed for a Solana ETF, speculation continues to mount amid rising institutional interest in diversified cryptocurrency products. Seyffart suggests that BlackRock might be biding its time, observing both market potential and regulatory outcomes before committing. Geraci adds that BlackRock could be waiting to see how much demand these initial Solana ETF launches generate. If investor appetite proves strong, the firm could rapidly “swoop in” with its own offering.

Seyffart also predicts that BlackRock is more likely to pursue a crypto index fund tracking the spot prices of several leading cryptocurrencies building on its massive success with Bitcoin and Ethereum ETFs. Such a product would cater to broader institutional demand and help BlackRock capture growth across the entire crypto sector, rather than focusing on a single asset.

Impact on Crypto ETF Competition

If BlackRock does file in the future, some industry watchers argue it could overshadow early entrants due to its immense brand power, scale, and established distribution networks. Seyffart, however, downplays the risk for BlackRock: with approximately 90% of total crypto market capitalization still concentrated in Bitcoin and Ethereum, missing out on other single-token ETFs is “not that big of a miss” for the asset management giant.

“It’s obviously not going to be what it is and was for Bitcoin, and like I said, I’m pretty bullish on the demand I see for index products,” Seyffart noted, highlighting his optimism for diversified crypto investment vehicles.

SEC Delays Continue for Solana ETF Bidders

The SEC has yet to make a final decision on the pending Solana ETF applications, requesting multiple rounds of clarifications and amended forms to ensure legal and regulatory compliance. While the industry anticipates the first wave of Solana ETFs, all eyes are on major players like BlackRock to see if and when they’ll enter the fray.

Key Takeaways

• Unfair late entry: James Seyffart contends it would be “messed up” for BlackRock to launch a Solana ETF alongside firms that have endured the full regulatory approval process.
• Early applicants: Firms like VanEck, Bitwise, and Grayscale have invested months with the SEC, awaiting approval.
• Crypto index funds: BlackRock may focus on diversified crypto index ETFs rather than single-asset offerings like a Solana ETF.
• Market impact: BlackRock’s participation could boost legitimacy but also threaten smaller issuers’ early advantage.
• SEC delays: The agency continues to scrutinize and delay decisions on all pending Solana ETF applications.

As regulatory decisions loom, the debate continues over fairness, competitive advantage, and the future structure of the U.S. crypto ETF landscape. Investors and issuers alike are watching closely to see whether BlackRock will join the Solana ETF race and if so, on what terms.