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Forms for Solana spot exchange-traded funds (ETFs) filed by VanEck and 21Shares have been unexpectedly removed from the Chicago Board Options Exchange (Cboe) website, leading to speculation that these applications might face delays or even denial.
The sudden disappearance of these filings has raised concerns within the crypto community, with many questioning whether the U.S. Securities and Exchange Commission (SEC) may have signaled a reluctance to approve the proposed Solana ETFs.
SEC’s Historical Caution with Digital Asset ETFs
The SEC has historically been cautious when it comes to approving digital asset-related financial products, as seen in the cases of both Bitcoin and Ethereum ETFs. The Commission often cites concerns about market manipulation and investor protection, which contribute to its prolonged review processes. However, unlike the Solana ETF forms that were removed from the Cboe website, there was no instance of missing forms during the review periods for Bitcoin and Ethereum ETFs, which lasted for several months.
In Ethereum’s case, the SEC initially considered disapproving the ETFs before ultimately approving the products on July 23. This context further fuels speculation about the SEC’s stance on the Solana ETF filings.
The removal of the Solana ETF forms from the Cboe website was first discovered by a user on X. He noted that the Form 19b-4 filings by both VanEck and 21Shares are no longer accessible on the Cboe website via direct links. He also pointed out that these documents, filed on July 8, had not been officially acknowledged by the SEC before their removal from the site.
Forms 19b-4 for VanEck and 21Shares Solana ETFs appear to have been removed from the CBOE website.
Documents SR-CboeBZX-2024-066 & SR-CboeBZX-2024-067 aren’t accessible anymore via direct link, and are no longer visible in BZX Pending Rule Changes.
Another interesting thing is… pic.twitter.com/t81kVGJ3uH
— Summers (@SummersThings) August 16, 2024
Rumors of SEC Involvement
Following the submission of the proposed Solana ETFs by VanEck and 21Shares, Cboe Global Markets had submitted a separate proposal to list the Solana-based ETFs on its platform, contingent upon SEC approval. Cboe even sought public consultation on the product. However, the apparent quiet withdrawal of the filings has fueled rumors that the SEC may have communicated concerns to VanEck and 21Shares, prompting the firms to reconsider their applications.
Some industry insiders suggest that the asset managers might be voluntarily pulling back their applications to address potential regulatory issues before resubmitting. Others, like Nate Geraci, the president of the ETF Store, took to X to suggest that the removal confirms SEC Chair Gary Gensler’s unwillingness to approve a Solana ETF during his tenure.
In response, Scott Johnson, a finance lawyer, speculated that the SEC Chair may have informed Cboe that the Solana ETF was “dead on arrival” under his watch. Johnson also suggested that Gensler might have indicated that the applications were improperly filed, possibly because Gensler does not classify Solana as a commodity.
“Instead of running through the full 19b-4 process, I’m assuming Gary notified Cboe that these Solana applications were improperly filed as Commodity-Based Trust Shares (because he thinks Solana isn’t a commodity), which obviates the need for the SEC to provide a formal written disapproval order (that is reviewable as a final agency action),” Johnson speculated.
Uncertainty for the Solana Community
The Solana community, which had been hopeful about the approval of these ETFs as a means to boost mainstream adoption of the network, now faces uncertainty. Should the SEC ultimately decide against approving the ETFs, it could represent a significant setback for efforts to integrate Solana into traditional financial markets.
Some Solana enthusiasts said the recent development could cause SOL to decline further. The digital asset is currently among the cryptocurrencies hit by the ongoing market turmoil. In the past 24 hours, the token has dropped nearly 2% to $144, according to data from CoinMarketCap.
