SEC Blocks Solana ETFs Amid Gensler's Final Crypto Stance

The U.S. Securities and Exchange Commission (SEC) under Chair Gary Gensler appears to be leaving the crypto industry with two controversial moves: the rejection of Solana (SOL) exchange-traded fund (ETF) applications and a lengthy filing in the Binance lawsuit.

Solana ETF Rejections

Bloomberg senior ETF analyst Eric Balchunas revealed that the SEC is set to deny two spot Solana ETF applications, calling the decision Gensler’s “parting gift” to the crypto industry. The denials are part of a broader freeze on new crypto-related ETF approvals, with Fox News’ Eleanor Terrett reporting that insiders from two Solana ETF issuers confirmed the SEC’s unwillingness to greenlight such filings under Gensler.

Gensler is expected to step down as SEC Chair on January 20, 2025, paving the way for Paul Atkins, who was confirmed for the role on November 27 by President-elect Donald Trump. Balchunas suggested that ETF issuers might refile their applications once the new leadership takes over.

Regulatory Implications

Bloomberg analyst James Seyffart argued that Gensler had little choice but to reject the Solana ETFs due to the regulator’s stance on SOL being a security in ongoing lawsuits. He predicted the applications would remain stalled until the SEC resolves the legal questions surrounding Solana. Seyffart initially projected that a Solana ETF could be approved by August 2025, but this timeline now appears optimistic.

A Shift in Leadership

With Gensler’s tenure nearing its conclusion, many in the crypto industry are looking to Atkins’ arrival for a potential policy shift. For now, both the Solana ETF and broader crypto regulation remain in limbo, awaiting decisions that could reshape the sector under a new SEC administration.