JP Morgan believes Solana and other crypto ETFs unlikely to gain regulatory approval

J.P. Morgan Nikolaos Panigirtzoglou, managing director and global markets strategist, said ETFs for Solana (GROUND) and other assets are unlikely to succeed.

In a statement to The Block on May 27, Panigirtzoglou argued that the SEC’s recent decision to approve Ethereum spot ETFs was “already pushed.”

Does the SEC consider ETH a title or commodity is unclear despite approvals.

Panigirtzoglou said the lack of clarity casts doubt on other assets, stating:

“We do not believe the SEC would go further in approving Solana or other tokenized ETFs.”

He added that the SEC believes that tokens other than BTC and ETH should be classified as securities, a stronger stance than that towards ETH itself.

Panigirtzoglou acknowledged that U.S. lawmakers could create legislation to classify most cryptocurrencies as non-securities, but said such legislation does not exist.

Others expect SOL ETFs

Some commentators are more optimistic about the chances of a SOL ETF.

Crypto investor Brian Kelly believes ETH ETF approvals could increase the chances of Solana ETF approval, but acknowledged that SOL’s status as a security is an issue.

Bloomberg ETF Analyst James Seyffart expects a Solana ETF succeed in a few years with laws such as FIT21, which will demarcate the securities and futures markets. He also recognized the security situation in Solana as a potential challenge.

The prediction market odds are low. Polymarket reports there is about a 13% chance that the SEC will approve a Solana ETF by the end of 2024.

SEC considers SOL a security

Regardless of future treatment, the SEC has already identified Solana and other altcoins as collateral in various enforcement cases.

In his case against Coinbase, the SEC said Solana was one of several tokens offered as an investment contract and security, both in past and present sales.

The regulator highlighted Solana Labs’ Simple Agreement for Future Tokens (SAFT), worth $23 million, as an example of an offering and sale of securities. He also called SOL a security in cases against Binance and Kraken.

However, the SEC has not filed a lawsuit directly against Solana Labs or related parties.

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Published in: Solana, WE, Cryptocurrency, ETFs

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