JPMorgan skeptical of SEC approval for Solana and other crypto ETFs

The recent approval of Ethereum spot exchange-traded funds (ETFs) by the U.S. Securities and Exchange Commission (SEC) has sparked discussions about the potential for other crypto ETFs, particularly those related to Solana (SOL) and to other altcoins.

However, JPMorgan, a leading investment bank, rremains skeptical about the SEC’s willingness to approve such funds.

TLDR

• JPMorgan is skeptical of the SEC’s approval of Solana and other crypto ETFs following the recent approval of Ethereum spot ETFs.
• The SEC’s decision to approve ETH ETFs is considered ambiguous given the uncertainty surrounding the classification of Ethereum as a security or commodity.
• The SEC strongly believes that tokens other than Bitcoin and Ethereum should be classified as securities.
• US legislation declaring most cryptocurrencies as non-securities could change the SEC’s stance on approving other crypto ETFs.
• The SEC has previously identified Solana and other altcoins as securities in various enforcement cases.

Nikolaos Panigirtzoglou, managing director and global market strategist at JPMorgan, believes that the SEC’s decision to approve ETH ETFs is already fragile due to the ambiguity surrounding the classification of Ethereum as a security or commodity.

The lack of clarity has raised doubts about the SEC’s stance on other cryptocurrencies.

According to Panigirtzoglou, the SEC is more convinced that tokens other than Bitcoin and Ethereum should be classified as securities.

This position poses significant challenge to Solana approval and other altcoin ETFs.

The SEC has previously identified Solana and other tokens as securities in various enforcement cases, such as those against Coinbase, Binance, and Kraken.

Approving Solana and other crypto ETFs would likely require U.S. policymakers to pass legislation declaring most cryptocurrencies as non-securities. However, Panigirtzoglou notes that no such legislation currently exists, making it difficult for these ETFs to be approved by the SEC.

Despite JPMorgan’s skepticism, some analysts remain optimistic about the potential of Solana ETFs.

Crypto investor Brian Kelly believes recent ETH ETF approvals could increase the chances of a Solana ETF approval, although he acknowledges that Solana’s status because security is an important issue.

Similarly, Bloomberg ETF analyst James Seyffart expects a Solana ETF to succeed within a few years, pending legislation like FIT21, which aims to delineate the securities and futures markets.

Prediction markets, however, reflect the uncertainty surrounding Solana ETFs. Polymarket, a decentralized prediction market platform, reports that there is about a 13% chance that the SEC will approve a Solana ETF by the end of 2024.

Until U.S. policymakers pass legislation clarifying the regulatory landscape, the future of Solana and other crypto ETFs remains uncertain.

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