JPMorgan Chase: Solana and other Crypto ETFs are less likely to be approved

Compiled by: Blockchain Knight

Nikolaos Panigirtzoglou, managing director and global market strategist at JPMorgan, said that ETFs for Solana and other assets are unlikely to be successfully approved.

In a statement to The Block on May 27, Panigirtzoglou believed that the SEC's recent decision to approve a spot Ethereum ETF was "stretched to the limit."

Despite its approval, it is unclear whether the SEC considers ETH to be a security or a commodity.

Panigirtzoglou said the lack of clarity casts doubt on other assets: "We don't think the SEC will go any further to approve Solana or other token ETFs."

He added: "The SEC believes that tokens other than BTC and ETH should be classified as securities, which is a tougher stance than its stance on ETH itself."

Panigirtzoglou acknowledged that U.S. lawmakers could enact legislation to classify most Crypto assets as non-securities, but he said such legislation does not exist.

Some critics are optimistic about the chances of Solana ETF approval.

Crypto asset investor Brian Kelly believes that the approval of the ETH ETF may increase the chances of Solana ETF approval, but he also admits that SOL's classification as a security is a "potential problem."

Bloomberg ETF analyst James Seyffart expects Solana ETF to be successful in a few years as legislation such as FIT21 divides the securities and futures markets. In addition, Seyffart also believes that Solana's security status is a potential challenge.

Polymarket reports that the SEC has about a 13% chance of approving the Solana ETF by the end of 2024.

Regardless of the future treatment, the SEC has previously identified Solana and other tokens as securities in multiple enforcement cases.

In the case against Coinbase, the SEC said Solana was one of many tokens offered as investment contracts and securities, both in past and current sales.

The regulator highlighted Solana Labs’ $23 million “Simple Agreement for Future Tokens” (SAFTs) as an example of an offer and sale of securities. The SEC also called Solana a security in its cases against Binance and Kraken.

However, the SEC did not initiate direct enforcement against Solana Labs or related parties.