SEC Moves Closer to Approving Solana and Litecoin ETFs, Experts Weigh In

The SEC has officially begun reviewing applications for Solana and Litecoin exchange-traded funds (ETFs), potentially opening the door for more altcoin-based investment products.

Grayscale’s Solana and Litecoin Trusts are now under regulatory consideration, a notable shift given the SEC’s prior reluctance to approve such offerings.

This move follows a recent change in the U.S. administration, which analysts believe could lead to a more favorable regulatory environment for crypto ETFs beyond Bitcoin and Ethereum. Bloomberg Intelligence’s Eric Balchunas noted that just weeks ago, the SEC, under former Chair Gary Gensler, forced the withdrawal of a Solana ETF application—making this development particularly significant.

Despite the SEC’s willingness to review these applications, challenges remain. Solana has been classified as a security in past lawsuits against major exchanges, raising regulatory uncertainties about its ETF approval. Analyst James Seyffart believes these legal matters must be addressed before the SEC grants approval.

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Market demand for a Solana ETF appears strong, with JPMorgan analysts estimating potential inflows of $3 billion to $6 billion if approved. However, they predict that Solana-based ETFs may struggle to match the popularity of Bitcoin and Ethereum ETFs.

Meanwhile, Litecoin’s ETF proposal is also under SEC review and may have an easier regulatory path. Unlike Solana, Litecoin has not been classified as a security, which could accelerate its approval. Some experts believe that a Litecoin ETF might be the first altcoin-based ETF to reach the market, given the regulatory clarity surrounding the asset.

With the SEC expected to reach a decision by October 11, the outcome could set a precedent for future altcoin ETFs, shaping the next phase of institutional investment in digital assets.

Alexander Zdravkov

Alexander has been working in the crypto industry for three years, during which time he has established himself through his active participation in monitoring market dynamics and technological innovations. His interest in cryptocurrencies and new technologies is not just a professional commitment, but a deep personal passion. He follows the news in the sector daily, analyzes trends, and is excited about every new step in the development of blockchain solutions. His enthusiasm drives him to continuously learn and share knowledge, as he sees the future in digital finance and its role in global transformation.