Solana's ETF Hits Major Roadblock as SEC Raises Concerns About Whether Solana is a Security

The potential for Solana ETFs to hit the market has come to a halt as the US Securities and Exchange Commission (SEC) expresses concerns about whether the cryptocurrency is a security.

According to reports, the SEC held discussions with prospective Solana ETF issuers regarding Solana's (SOL) potential status as a security before the Chicago Board Options Exchange (CBOE) removed related 19b-4 filings.

After the discussions, both the SEC and CBOE decided not to submit the 19b-4 forms to the Federal Register, as doing so would have pressured the SEC to make decisions regarding the proposed Solana ETFs. Without the 19b-4 forms, Solana ETFs will not be approved.

One astute user on X pointed out on 17th Aug, that Forms 19b-4 for VanEck and 21Shares Solana ETFs appear to have been removed from the CBOE website, speculating that the 19b-4s were withdrawn.

The source indicated that they expect there may be new filings or amendments to the 19b-4s in the future, aiming to present a stronger argument that Solana is not a security.

"We are unable to comment on the regulatory process at this time. We remain committed to expanding investor access to cryptocurrencies in the U.S. market and around the world," said Audrey Belloff, head of communications at 21Shares.

VanEck's Head of digital assets research, Matthew Sigel took to X saying "Remember that Exchanges like Nasdaq & CBOE file rule changes (19b-4) to list new ETFs. Issuers like VanEck are responsible for the prospectus (S-1). Ours remains in play".

Sigel also further added "For the record, VanEck believes SOL is a commodity, much like BTC and ETH. This belief is informed by evolving legal perspectives, where courts and regulators have begun to recognize that certain crypto assets may function as securities in primary markets but behave more like commodities in secondary markets."

Last week, both NASDAQ and the New York Stock Exchange (NYSE) withdrew their applications to list Bitcoin ETF options.

According to a filing on 14 August with the US Securities and Exchange Commission (SEC), the NYSE has pulled its application that would see a rule change to allow it to list and trade options on the Bitwise Bitcoin ETF (BITB) and the Grayscale Bitcoin Trust (GBTC).