Solana, a leading blockchain network, has captured the spotlight in the cryptocurrency market.
Following Donald Trump’s reelection as the 47th President of the United States, the price of its native token, SOL, surged to $188, marking a six-month high.
This price rally has elevated Solana (SOL) to the fourth-largest cryptocurrency by market capitalization, surpassing Binance Coin (BNB) and signaling renewed investor confidence.
Trump’s pro-crypto stance spurs market optimism
The cryptocurrency market’s response to Donald Trump’s victory has been overwhelmingly positive.
Known for his supportive rhetoric towards deregulation and US-based crypto initiatives, Trump’s return to the White House has fueled hopes of a more favorable regulatory landscape.
During his campaign, Trump underscored his commitment to creating an environment conducive to cryptocurrency growth, promising to push for reduced regulation and back domestic crypto mining.
Trump’s re-election is particularly significant as it comes at a time when the US Securities and Exchange Commission (SEC), led by Gary Gensler, has maintained a stringent stance on crypto assets.
Although US presidents cannot directly dismiss the heads of federal agencies, Trump’s campaign included hints at replacing Gensler, which would pave the way for a more crypto-friendly SEC chair. Such a leadership shift could foster policies that benefit projects like Solana.
Renewed optimism for a Solana ETF approval
With a Trump presidency, the possibility of a Solana exchange-traded fund (ETF) seems more likely.
Several firms have submitted applications for spot Solana ETFs with the most recent being Canary Capital which submitted its spot Solana ETF application towards the end of October. Others that have submitted for SOL ETF approval include VanEck and 21Shares.
An ETF linked to Solana would allow institutional and retail investors to gain exposure to SOL without directly holding the asset, thereby boosting mainstream adoption and liquidity.
Balaji Srihari, Business Head at CoinSwitch, in an interview with Decrypt, highlighted this potential shift, stating that Trump’s administration could ease the SEC’s hardline stance on crypto regulations. While optimism is on the rise, he noted that Solana’s path to an ETF will not be straightforward.
The blockchain must meet anti-money laundering (AML) and know-your-customer (KYC) compliance standards, demonstrate robust demand, and ensure secure custody solutions to gain approval.
“Ultimately, while a shift in political leadership could ease Solana’s path to approval, the future of its ETF will depend on a complex interplay of regulatory and market dynamics,” Srihari said, emphasizing the multifaceted nature of regulatory approval.
SEC’s classification of Solana as a security adds complexity to the ETF approval process, making compliance a critical aspect. Moreover, factors such as secure asset custody and proven market demand will play pivotal roles in influencing regulatory decisions.
The post Donald Trump’s victory boosts Solana ETF prospects, driving SOL price surge appeared first on Invezz
