According
to
a
recent
Bernstein
report,
the
approval
of
a
spot
Ethereum
(ETH)
exchange-traded
fund
(ETF)
in
the
US
may
establish
a
precedent
for
classifying
Solana
(SOL)
as
a
commodity.
The
classification
of
cryptocurrencies
as
either
securities
or
commodities
holds
significant
implications.
Commodity
classification
facilitates
ETF
applications
and
approvals,
while
security
classification
subjects
assets
to
stricter
SEC
oversight.
‘Big
three’
The
approval
of
spot
Ethereum
ETFs
would
mean
the
SEC
views
the
second-largest
crypto
as
a
commodity,
setting
a
critical
precedent.
This
would
mark
the
first
time
a
non-Bitcoin
digital
asset
receives
such
a
classification,
raising
expectations
for
Solana
to
follow
suit.
Ether’s
price
increased
earlier
this
week
after
Bloomberg
analysts
raised
the
likelihood
of
SEC
approval
for
spot
Ether
ETFs
to
75%
from
25%,
following
reports
that
the
regulator
requested
updates
to
filings.
The
SEC’s
final
decisions
on
these
applications
are
expected
later
today,
on
May
23,
following
multiple
delays.
Bernstein’s
report
noted
that
Bitcoin’s
75%
rally
following
the
approval
of
spot
ETFs
suggests
similar
price
action
for
Ethereum
after
approval
of
spot
ETFs.
However,
if
the
SEC
rejects
the
applications,
Ethereum
could
experience
significant
volatility
and
a
steep
price
correction
in
the
coming
days,
according
to
CryptoQuant
research.
Crypto
investor
Brian
Kelly
expressed
similar
optimistic
views
about
Solana
and
the
potential
regulatory
approval
of
Ethereum
ETF
products
during
a
recent
CNBC
interview.
He
speculated
that
SOL
could
be
the
next
altcoin
to
receive
ETF
approval,
highlighting
it
as
a
likely
candidate
for
investment
managers
to
push
forward.
Kelly
emphasized
that
Bitcoin,
Ethereum,
and
Solana
are
the
“big
three”
digital
assets
that
might
see
ETF
products
approved
in
this
cycle.
He
noted
the
success
of
Bitcoin
ETFs,
which
have
collectively
amassed
a
significant
amount
of
Bitcoin,
valued
at
around
$58
billion,
indicating
strong
demand
for
regulated
crypto
investment
products.
However,
Kelly
also
acknowledged
some
skepticism
within
the
Solana
community.
He
mentioned
that
Solana’s
initial
coin
offering
(ICO)
and
its
classification
as
a
security
by
the
SEC
could
pose
challenges
for
ETF
approval.
Despite
this,
Kelly
remained
optimistic
that
the
shifting
regulatory
and
political
landscape
might
increase
the
chances
of
Solana
ETF
approval
if
Ethereum
ETFs
receive
the
green
light.
Shifting
political
landscape
The
Bernstein
report,
released
ahead
of
the
SEC’s
final
decisions
on
ETH
ETF
applications,
also
highlighted
a
potential
shift
in
the
Biden
administration’s
stance
on
cryptocurrencies
based
on
recent
developments.
Additionally,
the
report
noted
that
if
Trump
is
reelected,
his
adminitration
is
likely
to
further
support
the
crypto
industry
through
legislative
and
regulatory
measures.
According
to
the
report:
“Should
Trump
get
elected,
crypto
could
see
significant
legislative
and
agency
support,
leading
to
long-lasting
structural
changes
in
crypto
financial
integration.”
The
potential
approval
of
Solana
ETFs
comes
amid
a
changing
regulatory
environment
and
growing
bipartisan
support
for
crypto.
The
recent
passage
of
the
Financial
Innovation
and
Technology
for
the
21st
Century
(FIT21)
Act
by
the
House,
with
significant
Democratic
backing,
indicates
a
potential
political
shift.
Lawyer
Jake
Chervinsky
described
the
bill’s
passage
as
a
“vote
of
no
confidence”
in
the
SEC’s
current
approach
to
crypto
regulation,
suggesting
political
consequences
for
maintaining
an
anti-crypto
stance.
Regulatory
approval
of
Solana
ETFs
would
mark
a
significant
milestone
for
the
crypto
industry,
signaling
mainstream
acceptance
and
integration.
However,
with
Ether
ETFs
still
awaiting
approval,
the
industry
remains
cautiously
optimistic
about
the
future.
Mentioned
in
this
article
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Author: Assad Jafri
