Sumit Roy
2 min read
There’s a lot of buzz about what’s next for crypto ETFs. After the high-profile debuts of Bitcoin and Ether funds, investors are eager to see which digital assets might be wrapped up into ETFs next.
Well, the “next” has already arrived, albeit with little fanfare.
In March, the first two U.S.-listed Solana ETFs quietly hit the market. These are not the long-awaited spot products that many in the crypto community are hoping for. Instead, they’re futures-based ETFs: the Solana ETF (SOLZ) and the 2x Solana ETF (SOLT), both from Volatility Shares.
So far, they’ve held their own. Since launching on March 20, SOLZ and SOLT have attracted $13 million and $21 million in inflows, respectively. Thanks to price gains in Solana, assets under management have risen to $17 million for SOLZ and $32 million for SOLT.
That’s not a breakout success, but it’s solid for a pair of niche ETFs in their first two months.
For context, the first Bitcoin futures ETF, the ProShares Bitcoin Strategy ETF (BITO), exploded out of the gate in 2021, reaching $1 billion in assets within two days. But Ether futures ETFs, launched in bulk in 2023, had a much more subdued reception. Combined, they had less than $30 million in AUM shortly after launch.
In that light, SOLZ and SOLT’s early traction looks more like that of the Ether futures ETFs than BITO’s blockbuster debut. And that makes sense. Bitcoin is still king, with a market cap of $2 trillion, dwarfing Ether at $300 billion and Solana at $90 billion.
Still, Solana shouldn’t be dismissed. The leveraged SOLT ETF, in particular, has the potential to be a popular product. Leveraged crypto ETFs have done well—Volatility Shares’ 2x Bitcoin Strategy ETF (BITX) has amassed $2.7 billion in AUM, while its 2x Ether Strategy ETF (ETHU) has $857 million.
That bodes well for SOLT, which uses a similar structure and caters to the same speculative audience.
SOLZ, the nonleveraged version, may face a tougher road. Most buy-and-hold investors prefer spot crypto ETFs over futures-based versions when they’re available. There’s $130.3 billion in spot crypto ETFs in the U.S. versus just $8.7 billion in derivatives-based funds. And within that $8.7 billion, $5.3 billion is in leveraged strategies, leaving only about $3.4 billion in plain vanilla futures-based funds.
So while the SOL futures ETFs are off to a decent start, their fortunes are likely to diverge upon the expected arrival of spot Solana ETFs.
