- Rex and Osprey are rolling out the first US Solana ETF that lets investors earn staking rewards, using a unique structure taxed as a C-corp.
- It’s not a typical spot ETF but a workaround to meet SEC rules while still giving direct SOL exposure and yield.
- More Solana ETFs are in the pipeline, with experts betting they’ll get approved soon, possibly kicking off an altcoin rally and putting Ethereum’s sluggish ETF launch in the spotlight.
Rex Shares and Osprey Funds are launching the first-ever US Solana ETF that directly owns SOL and passes staking rewards on to investors.
There’s a small twist, however.
Unlike Bitcoin and Ethereum spot ETFs, which work as commodity trusts, the new Rex-Osprey Solana ETF is set up as an investment company, taxed as a C-corporation under SEC rules. This means investors gain direct exposure to Solana’s staking yield, though through a regulatory path that hasn’t previously been used for cryptocurrency ETFs.
Related: Solana Advisor Nikita Bier Tapped as X’s New Head of Product
It is not a spot ETF in the traditional sense, but still is, technically, a Solana ETF, just structured differently in order to accommodate staking rewards, and therefore comply with SEC requirements.
This listing is just the first in a pipeline of Solana-focused ETFs awaiting SEC clearance. Nine proposals for conventional spot ETFs, structured under the Securities Act, remain under regulatory review.
Seven recently clarified their staking arrangements, showing growing regulatory focus on yield transparency. Expectations are high, and Bloomberg’s Eric Balchunas sees a 95% probability that these spot Solana ETFs will gain approval within two to four months, and could spark an altcoin summer.
Solana Launch Tests Appetite for Further ETF Launches
In a note published Tuesday, Peter Chung from Presto Research argued the Solana launch will reveal if Ethereum’s lackluster ETF performance is a chain problem, not a category problem.
A strong market response to the Solana ETF would challenge this, suggesting that Ethereum ETFs’ struggle stems from chain-specific issues rather than a flawed investment thesis.
Second, it will highlight the importance of staking. This will be the first ETF to offer staking rewards, unlike the spot ETH ETFs in their current iterations. A robust response would signal that yield matters for institutional investors.
Based on the ETH ETFs’ experience, a $150 million inflow in the first month would mark a solid start.
Peter Chung, Head of Research at PrestoRelated: Solana Poised for Institutional Growth, Says Cantor Fitzgerald Analyst
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