Grayscale has taken another step toward offering a spot Solana exchange-traded fund (ETF), filing a Form S-1 registration statement with the U.S. Securities and Exchange Commission (SEC). The move comes after NYSE Arca submitted a related proposal to convert the Grayscale Solana Trust into a publicly traded ETF.
New Filing to Pave the Way for Public Listing
The Form S-1, dated April 4, reveals Grayscale’s intent to list the ETF on the NYSE Arca exchange. Initially named the Grayscale Solana Trust (SOL), the product would be renamed Grayscale Solana Trust ETF once approved. This filing is a critical step in complying with the Securities Act and allows the firm to offer and trade shares of the ETF on a public market.
This submission follows NYSE Arca’s earlier 19b-4 application filed with the SEC. That proposal, acknowledged by the regulator in February, seeks to convert the existing Grayscale Solana Trust into a full-fledged exchange-traded product. Approval of both the S-1 and 19b-4 filings is required before the ETF can begin trading.
Details of the Proposed ETF Structure
The fund is designed to track the market price of Solana (SOL) using the CoinDesk Solana Price Index (SLX). Unlike futures-based ETFs, this would be a spot product, meaning it would hold actual SOL tokens.
Grayscale has tapped Coinbase as the ETF’s prime broker and custodian, while Bank of New York Mellon is set to serve as transfer agent and administrator. These roles are essential for managing the issuance, redemption, and transfer of ETF shares.
Initially, share creation and redemption will only occur through cash orders. This means authorized participants will need to buy or sell SOL via third-party liquidity providers to fund or redeem their shares. The filing also leaves room for in-kind transactions, which could be implemented later with the SEC’s blessing.
No Staking or Airdrop Participation
Notably, the trust will not engage in Solana staking, nor will it distribute any SOL received through forks or airdrops. This conservative approach may help the ETF avoid additional regulatory complications.
Grayscale has confirmed it will charge a management fee for the fund, which will be paid in SOL. However, the specific fee rate has not yet been disclosed. The fee will be calculated annually based on the ETF’s net asset value.
Solana’s Market Standing
As of April 3, Solana’s total market capitalization stood at $59 billion, making it the seventh-largest digital asset by market cap. Approximately 514 million SOL coins are currently in circulation, with $4.7 billion in 24-hour trading volume, according to CoinGecko data.
The move to launch a spot Solana ETF represents another push by Grayscale to expand its crypto ETF lineup, following a broader industry trend of increasing investor access to digital assets through traditional financial markets.
