SEC Concedes on Solana. But a SOL ETF Isn’t Any More Likely: Here’s Why
- The SEC amends its Binance suit, sparking hope among altcoin holders.
- The move seems to be a tactical maneuver by the agency.
- Experts explain why the SEC’s change doesn’t boost Solana ETF approval odds.
Altcoin traders have welcomed the latest development in the Binance lawsuit when the U.S. Securities and Exchange Commission (SEC) amended its accusations against altcoins. In particular, the SEC now seeks to avoid setting a precedent on whether or not these altcoins, including Solana (SOL), are securities.
Because the ruling could set a precedent for all altcoins, many altcoin holders hailed the decision as a victory. They also hoped that it would pave the way for a Solana Exchange Traded Fund (ETF), bringing in more investors to SOL. However, several analysts suggest that this outcome is unlikely.
What the SEC’s Solana Concession Means
The SEC’s recent legal maneuver has attracted significant attention. On July 30, the SEC filed a document to amend its claims in its lawsuit against Binance, which initially categorized several altcoins, including Solana, as unregistered securities.
Sponsored
The amendment’s purpose is to avoid an outcome where the court sets a legal precedent on whether or not altcoins are securities. Namely, if the altcoins are classified as securities, centralized crypto exchanges would be unable to list them as they now do, greatly hurting their value. Conversely, a different ruling would effectively remove the SEC’s authority over altcoins, which is something the SEC wants to avoid.
Because of this risk, analysts believe that the SEC did not change its stance on altcoins like Solana. For instance, crypto attorney Jake Cherinksy believes that the SEC could be making a tactical move, and waiting for a better case to set a precedent on altcoins. This is not good news for Solana ETFs.
Solana ETFs Likelihood Not Changed
Since the SEC maintains that altcoins like Solana are securities in its other cases, the prospects for a Solana ETF under the current leadership are low. Nate Geraci , co-founder of The ETF Institute, explained on Wednesday, July 31, what has to happen for Solana ETFs to become a reality.
According to Geraci, the approval of a Solana ETF hinges on one of three key developments. For one, Solana currently doesn’t currently have CME-traded Solana futures with a sufficient trading history. Notably, this is a requirement that both Bitcoin and Ethereum fulfilled before being approved.
Sponsored
Solana ETF could also become a reality if the legislators introduce a comprehensive crypto regulatory framework. In that case, the SEC would have to reassess its approach. Alternatively, a change in the current administration could lead to a change in the SEC leadership.
All of these factors mean that the Solana ETF is unlikely to be approved this year. The same goes for all other altcoin candidates for ETFs, including Ripple.
On the Flipside
- The SEC’s backtracking on setting a precedent highlights the regulatory uncertainty in crypto. Without a clear legal precedent, altcoin holders are in the dark about their future.
- Earlier, crypto influencers and some media outlets published unconfirmed reports that BlackRock was filing its own ETF. The company’s executives denied this in subsequent statements.
Why This Matters
The SEC’s legal maneuvers have significant implications for the altcoin market. If altcoins are ultimately classified as securities, the SEC would restrict their trading on centralized exchanges. This would have a significant negative impact on their liquidity and prices.
Read more about Solana and other altcoin ETFs:
Will Solana, XRP ETFs Become a Reality? BlackRock Tempers Expectations
Read more about how DeFi is becoming more accessible:
New To DeFi? Radix Radix Promises the Easiest Onboarding Experience for Newbies
coin_news.disclaimer
coin_news.may_like
Tron Switches to Chainlink for Better Data in DeFi Apps
Tron, a key player in the world of cryptocurrency, recently made a big change by switching its Oracle provider to Chainlink
BTC falls below $69,500
BNB falls below $570
WIF Price Pump to $3 Becomes Possibility as dogwifhat Price Chart Shows Bullish Breakout Indicator