Bitwise CEO Highlights Solana’s Advantage Over Ethereum in Staking ETFs

Solana ETF Staking Advantages Over Ethereum

Solana’s potential edge over Ethereum in the staking exchange-traded fund (ETF) market comes from its faster unstaking periods, which are crucial for ETF issuers needing quick asset returns to investors. Bitwise CEO Hunter Horsley highlighted this design advantage, pointing out that Ethereum‘s withdrawal queue recently hit highs with exit delays around 34 days, while Solana’s clears much faster. Anyway, this difference matters because ETFs must handle redemptions quickly to keep liquidity and investor trust strong. Supporting data shows Ethereum’s staking entry queue jumped to 860,369 ETH in early September, the highest since 2023, with average wait times of about three days for entries and much longer for exits. On that note, Solana’s network design enables rapid processing, cutting the risk of delays that could mess up ETF operations.

Key Benefits of Solana Staking for ETFs

• Faster unstaking periods compared to Ethereum
• Reduced risk of redemption delays
• Lower operational costs for issuers
• Enhanced investor confidence through better liquidity

Horsley noted that Ethereum-based products often turn to alternatives like credit facilities or liquid staking tokens such as Lido‘s stETH, but these come with extra costs and capacity limits. Comparatively, Ethereum’s workarounds bring inefficiencies that might put off institutional adoption. For example, Bitwise’s Ethereum staking product in Europe uses credit facilities to stay liquid, yet Horsley stressed their constraints. It’s arguably true that network-specific features directly shape financial product viability, with Solana‘s speed giving a clear boost in the competitive ETF scene.

It’s a huge problem. The ETFs need to be able to return assets on a very short time frame. So this is a huge challenge.

Hunter Horsley

Regulatory Milestones for Solana ETF Approval

The U.S. Securities and Exchange Commission (SEC) is set to make key decisions on multiple Solana and Ethereum ETF applications in October, with staking features taking center stage. These pending approvals involve major firms like Bitwise, Fidelity, Franklin Templeton, and VanEck, which have updated S-1 documents for staking rules. This scrutiny reflects the SEC’s careful approach, aiming to balance innovation and investor safety in crypto. Evidence indicates the SEC pushed back decisions on Ether staking ETFs from Grayscale to late October, and BlackRock‘s iShares Ethereum Trust to October 30. Similarly, Solana ETFs face deadlines that could unlock big money, as seen with the REX-Osprey Solana Staking ETF launch, which pulled in $33 million in trading volume and $12 million in inflows on day one.

Major ETF Applicants and Deadlines

These moves highlight the high stakes, with approvals possibly sparking wider altcoin use and reshaping market liquidity. You know, global regulatory styles differ; for instance, the EU’s MiCA rules offer clearer paths that might speed things up, while the U.S. process drags on. Critics say delays breed uncertainty and could slow market growth, but supporters argue thorough checks ensure stability. The SEC’s shift toward generic listing standards hints at faster reviews, yet Solana and Ethereum ETFs still face tough hurdles.

It’s a new day at the SEC, and a key priority of my chairmanship is developing a fit-for-purpose regulatory framework for crypto asset markets.

SEC Chair Paul Atkins

Institutional Interest in Solana ETFs

Institutional buzz around Solana is growing, driven by corporate treasury plans and ETF hopes, shown in efforts like the $1 billion Solana-focused fund backed by Galaxy Digital, Multicoin Capital, and Jump Crypto. Supported by the Solana Foundation and led by Cantor Fitzgerald, this fund aims to cut circulating supply and boost liquidity, echoing early Bitcoin moves that fueled long-term gains. Data reveals Solana futures open interest surged to about $14.5 billion, signaling heavy speculation by big players. More proof comes from corporate actions adding nearly $3 billion in potential demand, such as DeFi Development Corp buying over $400 million in SOL and Sharps Technology planning a $400 million treasury allocation.

Key Institutional Players and Investments

• Galaxy Digital: Backing $1 billion treasury fund
• Multicoin Capital: Supporting institutional initiatives
• DeFi Development Corp: $400 million SOL acquisition
• Sharps Technology: $400 million allocation plan

The high chance of SEC approval for a spot Solana ETF, pegged at 90%, might trigger inflows like those with Bitcoin and Ethereum ETFs, boosting Solana’s appeal. For example, Europe’s Bitwise Solana staking ETP attracted $60 million in five days, showing global institutional hunger. On that note, contrasting views flag risks like overvaluation or regulatory snags that could cool excitement. Skeptics warn that institutional involvement doesn’t shield from market drops, but backers say reduced supply through holdings can push prices up and add stability.

Solana’s institutional under-allocation presents a significant growth opportunity if ETF approvals proceed, but investors should remain vigilant of macroeconomic headwinds.

A crypto analyst at Pantera Capital

Technological Innovations in Solana Network

Solana’s tech upgrades have greatly boosted network performance, with the Alpenglow update slashing transaction finality to 150 milliseconds and raising throughput past 107,000 transactions per second. Backed by 98.27% of the community, this fix tackles scalability, making Solana a tough rival to Ethereum without needing extra layers. These improvements draw developers and users with high speed and low costs, strengthening Solana’s place in decentralized finance and other apps. Supporting data shows total value locked in Solana’s ecosystem grew 20% to $12.1 billion, while decentralized exchange volumes hit $111.5 billion over 30 days, topping Ethereum’s layer-2 networks combined.

Performance Metrics Comparison

Liquid staking options like LsSOL let users stake SOL while keeping liquidity, helped by partnerships with exchanges such as Coinbase and Kraken. The native staking yield of 7.3% encourages holding long-term, and apps like Kamino and Jupiter drive activity, each with over $2 billion in total value locked. Critics raise reliability worries, including past outages and high validator hardware needs, but Solana’s core design—mixing Proof of History with Proof of Stake—offers a solid base, and it often beats Bitcoin in downturns.

In-kind creation and redemption provide flexibility and cost savings to ETP issuers, authorized participants, and investors, resulting in a more efficient market.

Jamie Selway, Director of the Division of Trading and Markets, SEC

Market Sentiment and Economic Influences on Solana

Broader market mood shapes Solana’s performance, with U.S. economic issues like inflation fears and weak labor data leading to risk-off moves that cut total crypto market cap by $178 billion. This setting hits altcoins like Solana harder, as they often swing with majors like Ethereum and BNB in downturns. Historical trends suggest these sell-offs are usually brief, with rebounds when risk appetite returns. Data shows early optimism after rate cuts faded fast due to renewed economic concerns, highlighting crypto’s tie to macro signs. For instance, Solana’s price fell below $200 to around $192, wiping out gains from an eight-month peak of $253, a 19% drop that broke short-term momentum.

Economic Factors Affecting Crypto Markets

• Inflation rates and Federal Reserve policies
• Labor market data and employment trends
• Global risk appetite and investor sentiment
• Regulatory announcements and geopolitical events

Anyway, technical indicators like the relative strength index dipping below 30 have historically signaled buy chances, with four of five cases since April 2025 leading to quick rebounds, such as the jump from $176 to $206 in August 2025. Contrasting analyst takes exist; some see current volatility as a normal correction in a bull market, while others caution that bad economic news could extend bearish trends. Comparisons to past cycles show altcoins like Solana have bounced back, supported by institutional interest and tech strengths, but mixed with macro factors, outcomes stay unsure.

The RSI levels below 30 have historically signaled buying opportunities for SOL, but always cross-verify with broader market sentiment to avoid false signals.

A technical analyst

Future Outlook for Solana ETFs and Market Position

Pulling together insights gives a full picture of Solana’s future path. The recent price drop to around $192 seems more about market-wide risk aversion than Solana’s own flaws, with past V-shaped rebounds and strong institutional support hinting at recovery. Evidence includes neutral funding rates in derivatives, solid total value locked ranks, and corporate treasury efforts that build faith, though competition and regulatory unknowns bring challenges. Analytically, the high odds of ETF approvals by mid-October 2025 point to steady demand, backed by record futures open interest. Examples like the REX-Osprey ETF’s smooth start and Europe’s Bitwise ETP inflows suggest dips could be short-lived.

Factors Influencing Solana’s Future

Hurdles like tougher competition from chains such as BNB Chain might slow short-term gains, needing watchfulness from players. Divergent outlooks show uncertainty; some experts predict more declines if key supports break, while others see current setups as buy chances based on history. For instance, technical analyses target up to $300 or higher if resistances are crossed, but these must fit with basics like network activity and economic health. The mix of factors leans neutral to cautiously optimistic, heavily tied to ETF results and ongoing tech upgrades. Compared to past crypto cycles, Solana’s rise mirrors Bitcoin’s early days, with institutional interest and innovations powering long-term potential.

Altcoins may not see a broad, outsized rally until the approval of more crypto ETFs that give investors exposure further down the risk curve.

Analysts from Bitfinex