Franklin Templeton Seeks SEC Approval for Solana ETF Amid Growing Crypto Demand
Franklin Templeton has filed for a Solana ETF to give investors access without purchasing the cryptocurrency.
The SEC is reviewing several Solana ETF applications, with a 70% chance of approval this year.
The proposed ETF includes staking to attract investors seeking potential returns beyond asset appreciation.
Franklin Templeton filed an S-1 registration statement with the U.S. Securities and Exchange Commission on February 21 to introduce a Solana exchange-traded fund. The proposed fund seeks to monitor Solana’s price activity while allowing investors to maintain exposure to cryptocurrencies but without beneficial ownership. This development follows the establishment of the Franklin Solana Trust in Delaware, which was a necessary step for the ETF’s launch.
Several financial institutions, including Franklin Templeton, Grayscale, Bitwise, Canary Capital, 21Shares, and VanEck, have filed applications with the SEC seeking approval of Solana-focused ETFs. The Franklin Solana ETF will be listed on the Cboe BZX Exchange if approved. Coinbase Custody Trust Company, LLC, will serve as the custodian and will also ensure the secure storage of Solana holdings.
Staking could influence regulatory decisions
Franklin Templeton’s ETF proposal includes staking, a process that generates Solana rewards. This feature could make the fund attractive to both institutional and retail investors. Staking provides an additional source of revenue, but its classification remains uncertain under current SEC guidelines.
Other companies have pursued similar strategies. The New York Stock Exchange has requested SEC approval for staking in Grayscale’s Ethereum ETF. The Cboe BZX Exchange has filed a similar application for 21Shares’ Ethereum ETF. Previously, asset managers have removed staking from their filings to seek SEC approval for Ethereum ETFs. The outcome of the Solana ETF could impact future crypto investment products.
SEC's Stance on Crypto Staking Under Review
The SEC has stepped up its focus on crypto staking. Reports indicate that the agency is collecting data on various staking models and their impact. Last week, the SEC’s Cryptocurrency Working Group held discussions with Jito Labs and Multicoin Capital Management on staking-related topics.
With a change in regulatory leadership, asset managers are optimistic about the approval of new crypto products. Analysts estimate a 70% chance of Solana ETF approval this year. However, regulatory uncertainty remains and the timing of a decision remains unclear.