VanEck, a crypto-friendly asset manager and one of the issuers of spot Bitcoin exchange-traded funds (ETF) in the United States, has partnered with Kiln, an enterprise staking service provider, to offer regulated access to Solana staking rewards.
This collaboration is part of VanEck’s Solana strategy, which encompasses a range of products including exchange-traded notes (ETNs), ETFs and other investment products, all of which provide regulated access to the Solana network.
Simplifying Solana Staking
Staking allows Solana (SOL) holders to earn rewards by participating in the validation process of the Solana blockchain.
With Kiln’s integration, as per the company’s press release from Oct. 29, VanEck’s institutional clients can integrate Solana staking into their investment portfolios. This eliminates the need for investors to directly manage or stake SOL tokens.
VanEck customers will benefit from Kiln’s expertise in Solana staking, as Kiln manages over 2.5% of the Solana network and offers “competitive” staking rates through the Jito-Solana integration, all backed by a SOC 2 Type II certified infrastructure, according to Kiln.
@vaneck_us clients can now benefit from Kiln’s high-performance and secure staking services, backed by our SOC 2 Type 2 certified infrastructure.
Key Benefits:
Maximum security & uptime
Seamless institutional integration
Effortless exposure to Solana for… pic.twitter.com/KNcWhu74JF
— Kiln (@Kiln_finance) October 30, 2024
Bitcoin ETFs Soar, Ether Lags: Solana’s Turn Next?
The news follows a bumper year for crypto, largely fuelled by the long-awaited approval of spot Bitcoin ETFs in the U.S. in January. Since then, these products have attracted billions of dollars in investment (currently over $23.35 billion) and pushed Bitcoin (BTC) to a new all-time high in 2024.
While Bitcoin ETFs have garnered significant attention and inflows, a similar level of enthusiasm has not been observed for Ether ETFs. In fact, the historical cumulative net outflow for Ether ETFs has reached a substantial $485 million.
The next frontier for crypto ETFs could be Solana, a blockchain with a market capitalization of over $83 billion and a total value locked (TVL) of over $6.3 billion.
Both VanEck and 21Shares submitted applications for spot Solana ETFs this summer. However, negotiations with the Securities and Exchange Commission (SEC) reportedly stalled due to concerns about whether Solana qualifies as a security under U.S. regulations.
Some view these applications as a bet on a potential change in regulatory stance under a different U.S. administration in 2025.
“Looks like Solana ETFs are going to have a final deadline of mid-March 2025. But between now and then the most important date is in November. If Biden wins, these likely DOA [dead on arrival]. If Trump wins, anything is possible,” said Eric Balchunas, ETF analyst at Bloomberg Intelligence, in his July X post.
The expert also confirmed it again in his latest post on Oct. 1, talking not only about the proposed Solana ETFs, but also the XRP ETFs.
You’ve heard of the Fed Put. This is like the Trump Call.. filings for XRP or Solana or any other alt coins are basically like a cheap call option on a Trump win as Genz will be gone and anything’s poss. Harris wins no way these get approved, and the “call” expires worthless. https://t.co/mkpCbqEuQ4
— Eric Balchunas (@EricBalchunas) October 1, 2024
Europe Leads the Way in Solana Investment
Currently, Europe presents a more open market for regulated Solana investments products.
21Shares’ Solana staking ETP, ASOL, already boasts over $1 billion in assets under management (AUM), while competitors like CoinShares and Valour offer similar products with around $300 million in AUM each.
VanEck’s European Solana fund, VSOL, with around $86 million in AUM, is smaller but positioned for growth through the addition of staking rewards.
The partnership with Kiln positions VanEck to capitalize on the growing demand for regulated access to Solana and its staking rewards, particularly in Europe. Whether the U.S. market follows suit will likely hinge on regulatory clarity and the outcome of the upcoming presidential election.
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