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Grayscale Takes Next Step in Launching Spot Solana ETF
Grayscale Files Form S-1 with SEC
Grayscale has filed a Form S-1 with the US Securities and Exchange Commission (SEC) to convert its existing Grayscale Solana Trust (GSOL) into a publicly traded exchange-traded fund (ETF). The filing was made on April 4.
SEC Approval Odds
According to the decentralized prediction platform Polymarket, crypto traders are placing the odds of SEC approval for a Solana ETF at 83% before the end of the year. However, expectations for an earlier decision are lower, with just a 23% chance of approval predicted before July 31.
Solana ETF Details
Grayscale’s recent submission comes nearly four months after the firm’s initial 19b-4 filing, which the SEC officially acknowledged on February 6. If approved, the fund would be renamed the Grayscale Solana Trust ETF and listed on the NYSE Arca exchange.
Cash-Only Creation and Redemption System
Grayscale also revealed that the product would start with a cash-only creation and redemption system. The firm stated that it is not able to create and redeem shares via in-kind transactions with authorized participants at this time, and there has yet to be definitive regulatory guidance on whether and how registered broker-dealers can hold and deal in SOL in compliance with federal securities laws.
Custodian and Administrator
Coinbase will act as the ETF’s custodian, while BNY Mellon will serve as the fund’s administrator and transfer agent.
No Staking
Grayscale confirmed that the ETF will not engage in staking or earn yield from Solana’s proof-of-stake network. According to the filing, none of the trust, the sponsor, the custodian, or any other person associated with the trust will engage in staking or use the trust’s SOL to earn additional income or generate earnings.
Conclusion
Grayscale’s efforts to launch a spot Solana ETF highlight the growing momentum in the cryptocurrency market. The filing marks a significant step forward in the firm’s efforts to bring a Solana-based ETF to market, and the potential approval of the ETF could have significant implications for the industry.
FAQs
Q: What is a spot Solana ETF?
A: A spot Solana ETF is a type of exchange-traded fund that tracks the price of Solana (SOL) cryptocurrency.
Q: Who will act as the custodian for the ETF?
A: Coinbase will act as the ETF’s custodian.
Q: Who will serve as the administrator and transfer agent for the ETF?
A: BNY Mellon will serve as the fund’s administrator and transfer agent.
Q: Will the ETF engage in staking?
A: No, the ETF will not engage in staking or earn yield from Solana’s proof-of-stake network.
Q: What is the current status of the SEC’s review of the ETF?
A: The SEC has acknowledged Grayscale’s initial 19b-4 filing and the firm has filed a Form S-1 to convert its existing Grayscale Solana Trust into a publicly traded ETF. The outcome of the SEC’s review is uncertain at this time.
