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The SEC has so far treated these filings similarly to earlier crypto ETF applications – with cautious, prolonged reviews. Initial applications were submitted in early-to-mid 2024 (e.g. Cboe BZX filed for Franklin Templeton’s Solana Trust on March 12, 2025). The SEC delayed decisions multiple times in 2024 and 2025, pushing reviews to the maximum timelines allowed under law. As of late 2025, final decision deadlines are imminent. The earliest final window opens on October 10, 2025 (reportedly for VanEck’s Solana ETF), with another Solana ETF (Grayscale’s) also facing an Oct. 10 deadline. Other filings have final determinations due shortly after – for example, the SEC’s latest extension on Franklin Templeton’s Solana ETF sets a November 14, 2025 deadline for approval or denial. In sum, multiple SOL ETF proposals are converging toward critical SEC decisions in Q4 2025, making October 10 the first major make-or-break date.
Regulatory Dynamics and Key Hurdles
Regulatory scrutiny on these Solana ETF proposals has been intense. Historically, the SEC has denied or delayed crypto spot ETFs over concerns about market integrity – namely fraud, manipulation, and lack of regulated surveillance in the underlying crypto markets. Those same themes persist for Solana. In fact, the SEC’s initial delays cited the need for more time to ensure the listing exchange can meet standards of transparency and investor protection. Throughout 2025, SEC staff raised specific issues for Solana ETF issuers to address, including how the fund would handle asset custody, in-kind redemptions (trading Solana directly for ETF shares), and the mechanics and risks of staking (since Solana is a proof-of-stake network). These are nuanced hurdles unique to crypto ETFs: for example, the SEC wanted clarity on whether an ETF could participate in staking rewards safely, and how it would redeem shares without disrupting the SOL market. Notably, in June 2025 the SEC took the unusual step of asking all prospective Solana ETF issuers to amend their S-1 filings with detailed language on in-kind redemptions and staking – signaling the agency was actively engaging on resolving these issues rather than flat-out rejecting the concept. Sources even indicated the SEC appeared open to allowing staking within an ETF structure, provided proper safeguards. This level of engagement was a positive sign; as Bloomberg’s James Seyffart observed, the SEC’s official acknowledgment of Solana ETF filings (in February 2025) was “significant” given that previously the agency had refused to even acknowledge such altcoin ETF applications.
Another major legal hurdle hovering in the background is the SEC’s own stance on Solana as an asset. Under prior leadership, the SEC had hinted that SOL might be an unregistered security – for instance, 2023 enforcement actions (against exchanges like Coinbase) listed Solana among tokens alleged to be securities sold without registration. This raises a policy contradiction: approving a publicly traded ETF for SOL could tacitly treat it more like a commodity or currency. Industry participants have pushed back on this point. In late 2024, as SEC Chair Gary Gensler’s tenure was ending, a 21Shares spokesperson argued that “Solana’s native token, SOL, is eligible for inclusion in an ETF as a commodity,” noting that no court has found SOL to be a security to date. The expectation is that new SEC leadership in 2025 (which has been more crypto-friendly) may set aside the security classification debate in favor of pragmatic regulation. Indeed, by September 2025 the SEC took a historic step: it approved new generic listing standards for crypto-based ETPs on exchanges (Nasdaq, NYSE Arca, Cboe), removing the case-by-case grind for each product. This rule change, pushed by a more crypto-forward Commission, cuts the maximum approval timeline to ~75 days (down from 240+ days) for any crypto ETF that meets certain criteria. It effectively “opened the floodgates” for spot crypto ETFs beyond just Bitcoin and Ether. Under these standards, tokens that have a regulated futures market for >6 months are favored. Solana fits that bill, as the CME launched SOL futures in February 2025 – similar to how Bitcoin and Ether futures preceded their spot ETF approvals. All of these regulatory moves and statements set the stage for a potential green-light of Solana ETFs, while highlighting the last-mile issues (market surveillance, custody, staking) that issuers have worked to satisfy.
Approval Odds and Historical Precedents
Analyst sentiment around a Solana ETF approval has turned notably optimistic as 2025 progressed. Bloomberg Intelligence analysts now assign a high probability to the SEC approving spot SOL funds. In April 2025, senior ETF analyst Eric Balchunas “boosted the chance of a SOL ETF to 90% (from 70%)” after seeing the SEC’s engagement and the advent of SOL futures. Peers echo this confidence – for example, odds for a spot XRP ETF by year-end 2025 were estimated around ≈95% in analysts’ models, reflecting a broader expectation that multiple altcoin ETFs (Solana included) are likely to get the nod under the new regime. James Seyffart of Bloomberg went so far as to say he’d be “absolutely and utterly stunned” if the SEC failed to allow a spot Solana or XRP ETF to launch, given the groundwork laid. This bullish consensus stems from several precedents and patterns in prior crypto ETF rulings:
Bitcoin and Ether ETF Precedents: It famously took the SEC years of resistance and a court battle before the first U.S. spot Bitcoin ETF was approved. That breakthrough came in late 2023, leading to multiple Bitcoin ETFs launching in January 2024. Spot Ether ETFs followed thereafter (the SEC approved Ether funds once CME futures had operated for some time, signaling comfort with the market). Until now, no spot ETFs for other single tokens (like SOL) have been approved in the U.S.. But Bitcoin and Ether’s acceptance has paved the way – regulators have a template for crypto ETF oversight, and they’ve shown willingness to expand beyond just the top two assets. The SEC’s recent adoption of generic listing standards in Sept 2025 explicitly anticipates ETFs for “cryptocurrencies ranging from Solana to Dogecoin”, ending the one-off approval approach of the past. In short, the agency has shifted from outright denial of non-BTC products to creating a framework to streamline approvals for a broad basket of crypto ETPs].
Repeated Delays, Then Clustered Decisions: A consistent pattern in past crypto ETF reviews is that the SEC uses all available extensions before making a final decision. For the Solana filings, this has held true – the SEC opened formal proceedings and extended comment periods through mid-2025, kicking the can into Q4. (This mirrors how many Bitcoin and Ether ETF decisions were delayed to the last possible deadline in 2021–2023.) However, when approvals finally come, the SEC often moves in batches to avoid picking winners. For example, when Bitcoin futures ETFs were first allowed in October 2021, several launched in quick succession. Similarly, industry watchers suspect the SEC will approve multiple Solana ETFs at once (or in close timing) to maintain fairness. In fact, several issuers amended their filings by July 2025 (adding in-kind redemption and staking provisions) and saw “constructive progress”, but remained dependent on either the 19b-4 rule-change approvals or the new generic standards to actually launch. Now that the generic rule is in place, many expect the SEC to give a broad go-ahead. Historical rulings also show that SEC decisions can flip from denial to approval when political leadership shifts. The crypto ETF “ice thawed” only after a more receptive stance took hold (e.g. a pro-innovation tone from commissioners in 2025). Indeed, under the prior administration the SEC had been extremely slow on spot ETFs, whereas by late 2025 the Commission explicitly “voted to open the crypto ETF floodgates,” per Reuters. All these factors underscore why analysts assign high approval odds now.
Surveillance and Market Protections: Past denials (like the SEC’s rejection of the Winklevoss Bitcoin ETF in 2017) hinged on the absence of surveillance-sharing agreements with a “significant, regulated” market. To address this, recent crypto ETF proposals have partnered their listing exchanges with surveillance agreements (often involving Coinbase or CME data for pricing). The Solana ETF proposals similarly incorporate enhanced monitoring. The SEC’s willingness to contemplate approval suggests they believe enough safeguards (including the existence of CME Solana futures and robust custody solutions) can be in place. In short, the legal rationale for denial has weakened compared to a few years ago, as the crypto market infrastructure matures.
In summary, historical patterns indicate that while the SEC pushed these Solana ETF decisions to the limit of the timeline, the confluence of a more favorable regulatory climate, successful Bitcoin/Ether ETF precedents, and the industry meeting the SEC’s technical demands has made approval more likely than not. Analysts are betting that October 10, 2025 could mark another milestone in crypto’s integration into traditional markets.
Potential Market Impact: Approval vs. Denial Scenarios
Impact if Approved
If the SEC approves a spot Solana ETF, it would likely be a bullish catalyst for SOL’s market – at least in the short to medium term. New ETFs bring new sources of demand: retail and institutional investors who prefer buying an ETF through brokerage accounts (or are barred from buying crypto directly) could now get exposure to SOL easily. This broader access often translates into fresh inflows. We have seen analogous situations with other crypto ETFs – for example, Bitcoin’s price climbed to a new all-time high (~$67,000) immediately after the first U.S. Bitcoin ETF launched in October 2021. That debut (albeit a futures-based ETF) was viewed as a watershed moment and “likely to drive investment into the digital asset,” and indeed Bitcoin rallied ~3-4% on the day to record levels. A Solana ETF approval could spur similar enthusiastic buying. Notably, SOL’s price has already been sensitive to ETF news: when the SEC recently delayed (but did not reject) a decision, SOL’s price jumped over 4% in 24 hours amid speculation that approval was still on track. This “buy the news” reaction suggests traders are positioning for a potential rally on an actual approval. We could expect a swift price pop if Oct 10 brings a green light – potentially a move of 5-10% (or more) upward in SOL, as momentum traders and algos react to the headline, and as investors anticipate longer-term capital inflows.
Beyond the knee-jerk spike, an approved ETF can have a sustained impact through persistent inflows. For instance, the first Bitcoin ETF attracted over $1 billion in its first days, and its trading volume was among the highest for any ETF debut – indicating significant pent-up demand. Solana’s case might be more modest (analysts predict spot SOL ETF inflows would be smaller relative to Bitcoin or Ether ETFs, given SOL’s lower market cap and narrower investor familiarity). Even so, any steady creation of new ETF shares means the fund must buy and hold actual SOL tokens, creating organic buying pressure in the spot market. Additionally, an ETF lends legitimacy and may improve sentiment around Solana’s ecosystem, possibly attracting more institutional interest in the underlying network. On the flip side, traders should watch for the classic “sell-the-news” effect that sometimes follows exuberant rallies. Crypto markets often price in expected good news; SOL has had a strong run-up in 2025, and it’s not far from its previous all-time high already. If an approval is widely anticipated and largely priced in, the actual event could trigger some profit-taking. Nonetheless, the net impact of approval is expected to be positive for SOL’s price. Historically, the promise of ETF-driven adoption tends to put a firm bid under an asset. And with Solana’s relatively smaller float, even moderate fund inflows could support a material price increase. In summary, an approval on Oct 10 would likely boost market confidence in SOL, potentially driving it higher in the short term and reinforcing an upward trajectory if ETF assets grow over time.
Impact if Denied
If the SEC denies the Solana ETF (or otherwise issues a surprising disapproval on Oct 10), the immediate market reaction would likely be negative for SOL. Such an outcome would defy the high expectations set by industry observers, so it could catch traders off guard. Historical ETF rejections in crypto have triggered sharp sell-offs. A clear example is from March 2017: when the SEC announced it would not approve the Winklevoss Bitcoin ETF, Bitcoin’s price plunged almost instantly – from about $1,350 to $980 (a 27% drop) within hours. It did stabilize after that initial shock (recovering to ~$1,100), but the event wiped out a big chunk of value in minutes. We could see a similar dynamic with SOL: a knee-jerk sell-off as disappointed ETF hopefuls unwind positions. Given SOL’s volatility, a double-digit percentage price drop is possible in a denial scenario, especially since a lot of speculative long positions have likely built up on ETF optimism (open interest in SOL futures has been high, partly reflecting these bets). A denial would not only dash the near-term catalyst but also raise concerns about broader regulatory setbacks (e.g., “if the SEC won’t approve SOL now, what does that imply for other altcoins?”).
That said, the magnitude and duration of a downturn on denial would depend on the context. If the denial comes despite the new listing standards and positive signals, it might imply unresolved SEC concerns (perhaps last-minute issues with market surveillance or a resurgence of the security-classification argument). This uncertainty could pressure SOL’s price beyond just a one-day move, as investors reprice the risk of “no ETF for the foreseeable future.” On the other hand, if it’s a technical or timing-related denial (for example, the SEC asking for further amendments or simply preferring to approve under the generic rule a bit later), the market may interpret it as a temporary delay rather than a permanent roadblock. In that case, SOL’s drop might be more muted and short-lived, with dip-buyers stepping in on the assumption that approval is still inevitable in the next wave. Indeed, by late 2025 many believe any denial would likely be overturned by political/regulatory shifts soon after (consider that a new pro-crypto administration has already signaled support). Still, for traders, a denial on Oct 10 would inject volatility. We can expect an immediate price pullback and jump in volatility metrics. Past crypto ETF disappointments often saw an uptick in selling volume and derivative liquidations as leveraged longs got caught offside (for example, crypto markets lost hundreds of millions in longs liquidated on negative regulatory news in various instances). SOL could similarly see a spike in liquidations if a surprise rejection hits.
In summary, approval and denial present contrasting market outcomes for SOL: Approval likely brings a wave of optimism and buying, potentially lifting SOL’s price given historical patterns of ETF-fueled rallies. In contrast, denial could deal a short-term bearish blow, with a sharp sell-off reminiscent of prior SEC rebuffs. Crypto traders and analysts will be closely watching the SEC’s move on October 10, 2025 – not only to gauge Solana’s trajectory, but also as a barometer for how U.S. regulators are embracing (or impeding) the broader integration of crypto into mainstream finance.
Lionel Kaufmann is an independent crypto strategist and founder of AlpCrypto. With years of experience in blockchain infrastructure, self-custody solutions, and digital asset governance, he specializes in helping individuals and organizations navigate crypto markets with a focus on security, regulation, and long-term adoption.