21Shares has filed with the United States Securities and Exchange Commission (SEC) to introduce the 21Shares Core Solana ETF, following the recent filing by VanEck for a similar spot Solana ETF.
The 21Shares Core Solana ETF seeks to replicate the performance of Solana (SOL), offering investors a convenient and cost-effective way to access SOL without needing direct ownership of the asset, as outlined in the filing.
If given the green light, the ETF will trade on the Cboe BZX Exchange. Its main goal is to mirror SOL’s performance, accounting for the fund’s costs and obligations. SOL assets held by the ETF will be protected by Coinbase Custody Trust Company, a regulated third-party custodian. The ETF will avoid direct investments in derivatives, choosing to maintain SOL holdings to reflect the value of its shares.
Operated by 21Shares US LLC, the ETF will ensure daily valuation of its shares based on an index reflecting SOL’s performance in U.S. dollars. Authorized participants can create and redeem shares by depositing cash with the trust, which is used to purchase SOL from designated SOL counterparties. These counterparties manage transactions and transfer SOL to the ETF’s custodian, ensuring accurate reflection of SOL’s value in the ETF’s shares.
Redemption of shares involves transferring SOL to counterparties, who sell the assets and return cash proceeds to the trust, maintaining asset efficiency and liquidity for investors.
The filing includes provisions for potential regulatory reclassification of Solana as a security, allowing termination of the trust if ETF sponsors choose not to comply with additional regulatory requirements. This underscores ongoing regulatory uncertainties within the cryptocurrency market.
Andrew Jacobson, Vice President and Head of Legal at 21Shares, expressed optimism about the ETF’s potential impact on the Solana ecosystem. He emphasized the ETF’s role in enhancing accessibility to crypto assets through regulated financial products, aligning with 21Shares’ mission.
The introduction of the 21Shares Core Solana ETF represents a significant milestone in institutional participation in the crypto sector, echoing broader trends of integrating digital assets into mainstream financial markets. With VanEck also pursuing a Solana ETF, the filings indicate growing institutional confidence in Solana’s market potential, offering investors diversified options for crypto asset portfolio management.