Asset management firm Volatility Shares has filed an application with the U.S. Securities and Exchange Commission (SEC) to list the Solana exchange-traded futures fund (ETF). This strategic move comes after a group of asset managers applied to launch the Solana Spot ETF earlier this year.
Will volatile stocks increase the odds of approval for spot ETFs?
In a December 27 post on the X platform, ETF Shop Head Nate Geraci said open Volatility Shares has filed for a futures-based Solana ETF with the U.S. Securities and Exchange Commission. An exchange-traded futures fund offers publicly traded securities that provide exposure to price movements in cryptocurrency futures (the SOL futures contract, in this scenario).
For context, futures refer to financial derivatives that allow investors to speculate on the future price of an asset without directly owning it. With the Solana Futures Fund, Volatility Shares intends to offer products with three different types of leverage, including 1x, 2x and -1x exposure.
SOL futures ETFs with 1x exposure will track the price of Solana futures without leverage, while funds with 2x exposure will provide leveraged exposure and amplify the price movement by 2x. Meanwhile, Solana ETFs with -1x leverage provide inverse exposure, meaning they gain value when futures decline.
Source: @NateGeraci/X
According to Geraci, this application of volatility stocks may be important even for SOL spot ETFs, considering the asset manager’s role in approving Ethereum futures ETFs. The asset management company has pushed the Securities and Exchange Commission to greenlight cryptocurrency products in 2023.
The head of the ETF shop highlighted that the filing specifically states “Solana futures are only traded on an exchange registered with the Commodity Futures Trading Commission.”
Bloomberg ETF expert Eric Balchunas also commented on Volatility Shares’ future Solana ETF application, noting that it is a welcome development in the cryptocurrency space. According to Balchunas, this latest filing bodes well for the success of the SOL ETF immediate implementation.
This is wild. Solana Futures ETF Offers Solana Futures even exist! Oh and let’s do 2x while we’re at it. Solid core…which is probably a good sign for SOL futures in the way that arguably bodes well for the spot prospects. This was supposed to be a quiet week! https://t.co/YiwauQfaji
– Eric Balchunas (@EricBalchunas) December 28, 2024
Solana price at a glance
As of this writing, SOL is at around $195, reflecting a 5.5% increase over the past 24 hours. According to CoinGecko data, the value of SOL jumped almost 6% in the past week.
The price of SOL on the daily timeframe | Source: SOLUSDT chart on TradingView
Featured image by Dreamstime/Aivaras Sakurovas, chart from TradingView
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