Solana Achieves Spot ETF Listing in the US: Why XRP Lags Behind
Solana has recently taken a significant step forward by securing a spot ETF listing in the United States, leaving XRP to follow in its wake. The distinction between the two wasn’t based on market capitalization or political influence but rather on the mechanics of the listing process. Multicoin Capital’s general counsel, Greg Xethalis, outlined the essential criteria an issuer must satisfy to launch during a period when the SEC is not fully operational. This set the stage for Bitwise and Canary to proceed, whereas XRP issuers remain in a holding pattern.
Understanding the Listing Mechanics
To successfully launch a spot ETF, there are specific legal and procedural requirements that need to be met. These include:
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- Effective Registration Statement on Form S-1 under the ’33 Act
- 19b-4 Approval under the ’34 Act, which is sometimes bypassed by CBTS Generic Listing Standards
- Trading Rules Letter, also bypassed by GLS
- Filed Registration Statement on Form 8-A
- An exchange willing to certify the 8-A and permit the launch
Xethalis, with his extensive experience in exotic ETP legalities, described this process as venturing into somewhat unexplored territory.
The Solana Advantage: Why Timing Mattered
The critical differentiator for Solana was the timing and strategy of their filing. Under the 1933 Act, an S-1 can become automatically effective 20 days after filing unless a delaying amendment is added. Exchanges were willing to leverage this auto-effectiveness during a period when the SEC staff wasn’t accelerating registrations.
Xethalis highlighted the usual approach: “Issuers typically file a delaying amendment to prevent an S-1 from auto-effectiveness, allowing the SEC to decide on accelerating effectiveness.” This practice, however, was upended by Bitwise’s strategic filing on October 8 without a delaying amendment, setting the automatic effective date as October 27.
The question then became whether exchanges would list products not accelerated by SEC approval. The NYSE and NASDAQ answered affirmatively, deciding to list the Bitwise Staking Solana ETF and Canary products, respectively.
The Role of Generic Listing Standards
The acceptance of generic listing standards has streamlined the process, enabling issuers like Bitwise and Canary to expedite their listings. These standards eliminate the need for individualized rule filings for commodity-based digital asset trusts, provided that the issuer’s S-1 and 8-A are in order and the exchange is ready to certify and list.
Why XRP Remains in the Queue
For XRP, the delay isn’t due to the asset’s merit but rather the sequencing and completeness of regulatory filings. While Grayscale’s Solana Trust filed an S-1 that will go effective shortly, the absence of a filed Form 8-A and the lack of an exchange ready to certify and post a listing notice are hurdles. This situation illustrates that an effective S-1 alone is not enough; the entire checklist must be complete.
Xethalis emphasizes that the changes to the 19b-4 deadlines, now addressed by CBTS Generic Listing Standards, have removed previous bottlenecks. However, the process still requires precise execution of the issuer’s S-1 filing and the exchange’s listing certification.
The Road Ahead for XRP
While Solana has successfully navigated the regulatory landscape for its ETF listing, XRP’s journey continues. The strategic decisions made by Solana’s issuer have positioned it to “win the race” this week, but XRP’s path remains open once the necessary regulatory and procedural steps are completed.
Conclusion
Solana’s achievement is a testament to the importance of timing, strategy, and regulatory navigation in the evolving landscape of digital asset listings. While XRP’s current status reflects procedural delays rather than regulatory or political barriers, the framework now exists for future listings to proceed with greater ease and predictability.
At the time of writing, XRP is trading at $2.62.
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