The potential approval of a new altcoin exchange-traded fund (ETF) in the United States hinges on the political landscape following the upcoming 2024 U.S. presidential election, despite recent developments allowing spot Ether ETFs.
While the U.S. Securities and Exchange Commission (SEC) greenlit fund managers to list spot Ether ETFs on May 23, SEC Chair Gary Gensler cautioned that launching these ETFs would take time. Nevertheless, speculation surrounding the next crypto ETF has already surfaced, with Solana emerging as a leading contender.
However, Ophelia Snyder, co-founder and president of 21.co — a sponsor and subadviser for ARK Invest’s spot Ether ETF — urges caution, suggesting that expectations for new altcoin ETFs should remain grounded.
Yet, with institutional investors showing a growing interest in altcoins, particularly Solana, the possibility of altcoin ETF applications cannot be overlooked. According to a report by CoinShares, hedge funds and wealth managers have notably increased their altcoin holdings, emphasizing Solana’s prominence.
Snyder underscores the substantial demand for 21.co’s Solana exchange-traded product (ETP) on European exchanges, boasting nearly $990 million in assets under management.
Although the SEC’s approval of spot Ether ETFs was a significant development, the outlook for altcoin ETFs remains uncertain. While altcoin ETFs are prevalent worldwide, U.S. regulators maintain a more cautious stance.
Eric Balchunas, an ETF analyst at Bloomberg, explains that the SEC adheres to a specific approval timeline, suggesting that securing approval for an altcoin ETF could take years, mirroring the process for spot Bitcoin and Ether ETFs.
One critical aspect aiding the SEC’s scrutiny of market integrity is the utilization of data from the Chicago Mercantile Exchange (CME) to assess correlation with spot prices on exchanges like Coinbase and Kraken. Joshua de Vos, research lead at crypto data firm CCData, emphasizes the significance of a substantial asset tenure on CME for such analysis.
Summary Review: As the crypto market eagerly awaits potential altcoin ETF approvals, the political landscape, institutional demand, and regulatory scrutiny will shape the trajectory of these developments. While Solana and other altcoins garner attention, navigating regulatory hurdles remains paramount for ETF issuers seeking approval in the United States.
Disclaimer: Remember that nothing in this article and everything under the responsibility of Web30 News should be interpreted as financial advice. The information provided is for entertainment and educational purposes only. Investing in cryptocurrency involves inherent risks and potential investors should be aware that capital is at risk and returns are never guaranteed. It is imperative that you conduct thorough research and consult with a qualified financial advisor before making any investment decision.
