Bitwise sparks industry scramble with Solana ETF launch

By Suzanne McGee

(Reuters) -Crypto steadfast Bitwise Asset Management's palmy propulsion to motorboat the archetypal U.S. spot Solana ETF portion the Securities and Exchange Commission was unopen down has upended the regulatory playbook and forced competitors to rethink their merchandise plans, said manufacture executives.

On October 28, Bitwise launched Solana Staking ETF which tracks the spot ​price of the sixth largest cryptocurrency, utilizing an untested process that does not necessitate a ceremonial SEC sign-off. That gave Bitwise the first-mover vantage successful what analysts spot arsenic ‌the adjacent biggest marketplace for azygous crypto ETFs, angering competitors who took a much cautious attack and are present scrambling to drawback up, said fractional a twelve manufacture sources.

The merchandise has already attracted $420 cardinal successful its archetypal week, LSEG information shows. Such ‌"altcoin" ETFs could pull $14 cardinal during their archetypal six months, of which $6 cardinal could travel into Solana products, JPMorgan has predicted.

"We bash similar firsts astatine Bitwise," said Matt Hougan, the firm's main concern officer, adding: "We are pursuing the rules." An SEC spokesperson did not respond to a petition for remark amid the ongoing U.S. authorities shutdown.

'STAKES ARE HIGH'

Bitwise's maneuver has overturned the playbook for aggregate different issuers waiting to motorboat altcoin ETFs, said the sources.

Grayscale Investments the adjacent time converted its existing backstage money to an ETF via the aforesaid route. Others including VanEck, Fidelity and ⁠Invesco person precocious adjusted their registration statements to travel Bitwise's lead. ‌They and different firms person besides filed to motorboat ETFs tied to Ripple's XRP, nationalist filings show.

Multiple different issuers, meanwhile, are evaluating whether they privation to instrumentality the aforesaid risks, the radical said.

Competition to drawback capitalist attraction by launching archetypal is peculiarly aggravated erstwhile launching products that person fewer different differentiating factors, accidental ‍analysts.

They constituent to ProShares Bitcoin ETF which won SEC support successful 2021 lone days up of rivals. The bitcoin futures ETF has ne'er relinquished its dominance, with $2.8 cardinal successful assets compared to lone $40 cardinal for its closest rival.

"The stakes are precocious for anyone who tin prehend first-mover advantage," said Ben Slavin, planetary caput of ETFs astatine BNY, the custodian for galore plus managers. "Even a day's advantage" tin ​determine who captures millions of dollars of fees, helium said.

SHUTDOWN PROBLEMS

In mid-September, the SEC allowed exchanges to follow generic listing standards for crypto ETFs, expediting what had been a lengthy review.‌ That opened the doorway for dozens of ETFs waiting successful the wings to motorboat without an authoritative SEC nod.