Asset management giant Franklin Templeton has officially registered the Franklin Solana Trust in Delaware, signaling its intent to enter the growing competition for a spot Solana exchange-traded fund (ETF) in the United States. The move positions Franklin alongside other major asset managers like Grayscale, Bitwise, VanEck, 21Shares, and Canary Capital, all vying to bring the first spot Solana ETF to market.
A Step Toward Institutional Solana Adoption
According to a February 10 filing with Delaware’s corporate regulator, the Franklin Solana Trust was formed under the CSC Delaware Trust Company, which has also handled trust registrations for other leading crypto asset managers, including Bitwise. The next step for Franklin will be to submit a Form 19b-4 and a Form S-1 to the Securities and Exchange Commission (SEC)—an essential requirement to formally launch the ETF approval process.
Historically, some asset managers who registered crypto trust products in Delaware quickly followed up with an SEC filing, indicating Franklin Templeton may soon file its ETF application.
If approved, the Franklin Solana Trust will track Solana’s price movements, offering institutional and retail investors regulated exposure to the fifth-largest cryptocurrency, which boasts a $97 billion market cap, per CoinGecko data.
Which Exchange Will List Franklin’s Solana ETF?
The filing did not specify which exchange would list the ETF, but Franklin’s existing spot Bitcoin and Ethereum ETFs are both listed on the Cboe BZX exchange. Given this precedent, it’s likely Franklin’s Solana ETF would also seek listing on Cboe BZX, though this remains to be confirmed.
Franklin’s Endorsement of Solana’s Growth
Franklin Templeton has consistently praised Solana’s network and ecosystem, highlighting its ability to overcome technological hurdles and leverage the advantages of monolithic blockchain architecture. In July 2024, the firm emphasized Solana’s high-transaction throughput, while in January 2024, Franklin pointed to the explosive growth of Solana’s DeFi applications and memecoin activity.
What Are the Chances of SEC Approval?
Bloomberg ETF analysts James Seyffart and Eric Balchunas estimate a 70% chance of a spot Solana ETF approval by the end of 2025. They further noted that odds could significantly increase depending on the outcome of the U.S. presidential election in November.
However, a key regulatory hurdle remains: Solana’s classification as a security. Seyffart previously noted that the SEC would first need to resolve this issue before approving a Solana ETF under a commodities framework.
SEC Begins Reviewing Solana ETF Applications
The SEC has recently acknowledged multiple Form 19b-4 filings for spot Solana ETFs, including those from 21Shares, Bitwise, Canary Capital, and VanEck. Earlier, on February 6, the regulator acknowledged Grayscale’s Solana ETF filing, a noteworthy development considering that previous applications were reportedly rejected under former SEC Chair Gary Gensler.
Market Impact and Institutional Inflows
JPMorgan analysts estimate that an approved spot Solana ETF could attract between $3 billion and $6 billion in net assets within its first year. Bloomberg’s Balchunas called this prediction a “reasonable estimate”, given the increasing institutional interest in layer-1 blockchain assets beyond Bitcoin and Ethereum.
Currently, Solana is trading at $198.50, reflecting a 1.5% decline over the past 24 hours, according to CoinGecko data.
Final Thoughts: A Game-Changer for Solana and Crypto ETFs?
Franklin Templeton’s move to file for a Solana Trust and Spot SOL ETF marks a significant development for institutional crypto adoption. If successful, this could:
- Further legitimize Solana as a leading blockchain asset in traditional finance.
- Increase institutional inflows into Solana’s ecosystem.
- Set the stage for wider adoption of altcoin-based ETFs.
As regulatory discussions continue, all eyes will be on the SEC’s response to these growing ETF applications. If Solana ETFs receive approval, it could mark a pivotal moment for the crypto market, opening new avenues for regulated investment products beyond Bitcoin and Ethereum.
