Top Experts Unanimous That Solana Gets the Next Spot ETF, Not XRP

Prominent figures in the finance scene propose that Solana (SOL) will be the next crypto asset to receive a spot exchange-traded fund (ETF) after Ethereum.

During a recent interview on CNBC, Brian Kelly, founder of digital currency investment firm BKCM, weighed in on the conversation around which cryptocurrency gets an ETF should the U.S. SEC endorse filings for Ethereum funds today. 

Kelly first voiced confidence that approval for Ethereum spot ETF is inevitable. Regarding the crypto to follow Ethereum, he proposed Solana. He recognized SOL as a strong contender due to its market competitiveness with ETH. 

Bloomberg Analyst Agrees

James Seyffart, a prominent ETF analyst at Bloomberg Intelligence, agrees with Kelly’s view. Seyffart highlighted that Solana particularly fits based on the current precedent and market condition.

Nonetheless, the ETF pundit suggested it could take a few years to see a Solana spot ETF. This is due to crucial listing requirements, such as establishing a CFTC-regulated futures market for Solana. 

Moreover, Seyffart argued that the earliest timeline for a Solana spot ETF would be 2026. Yet, he noted that the recently passed pro-crypto bill could accelerate this projected timeline.

Furthermore, Seyffart emphasized that a Solana spot ETF would garner more investor demand than ETFs of other crypto assets, besides Bitcoin and Ethereum. This further strengthens the view that a SOL ETF may precede other altcoin ETFs.

Based on current precedent/needs — Will happen within a few years of getting a CFTC regulated futures market. But congress & Market structure bills like FIT21 could make it happen quicker.

I think a SOL ETF would see most demand vs other digital assets (aside from BTC & ETH)

— James Seyffart (@JSeyff) May 22, 2024

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Solana’s Security Status Remains an Issue

Meanwhile, the Bloomberg analyst pointed to a factor that could delay Solana’s chances of getting an exchange-traded fund.

In particular, he cited the U.S. SEC’s position that SOL is a security, as prominently contested in the regulator’s lawsuits against Coinbase, Kraken, and Binance. He believes the SEC’s current view on SOL “could very easily make this [ETF] a very rocky road.”

XRP ETF Far In the Future

While XRP boasts a clearer regulatory status, Seyffart does not believe it holds a better chance against Solana.

In an earlier discussion, the ETF analyst stressed the need for Ripple’s ongoing lawsuit with the SEC to end. Additionally, he mentioned establishing a CFTC-regulated futures market for XRP before there can be any possibility of an XRP spot ETF.

Moreover, Seyffart believes that the permission for an XRP ETF would likely require a new SEC chairman. He views all these necessary conditions as likely to unfold over an extended period, thus delaying the prospect of an XRP ETF further.