Cryptocurrency ETFs Following Solana - XRP, Cardano, Avalanche Potentially in the Spotlight
The cryptocurrency market has seen a significant development with the successful debut of the REX-Osprey Solana ETF. This milestone could pave the way for other altcoins to follow suit, particularly XRP, Avalanche (AVAX), and Cardano (ADA).
XRP, known for its strong liquidity, legal clarity, and established use case in cross-border payments, appears to have the strongest chance of receiving ETF approval following Solana. XRP's daily trading volumes average over $1.2 billion across global exchanges, and it is listed on over 100 exchanges worldwide.
Avalanche, another strong contender, offers a modular architecture, high developer activity, and growing adoption among enterprise users. With over 120 subnets and partnerships with firms like Amazon Web Services and JPMorgan, Avalanche's focus on real-world asset tokenization places it in a prime position for institutional traction. AVAX has a DeFi TVL of $1.6 billion, ranking it within the top 6 in the DeFi space.
Solana, with its high throughput of up to 65,000 transactions per second (TPS) and over 2,400 active validators, also presents a compelling case. Solana ranks #6 by market cap at over $67 billion as of July 2025.
However, it's important to note that none of the altcoins mentioned have CFTC-regulated futures markets, which is the biggest hurdle for ETF approval. The SEC's approach to ETF approvals centers on market maturity, investor protection, and surveillance sharing agreements. To qualify for an altcoin ETF approval in the United States, the current regulatory requirements focus on several key areas:
- In-kind creation and redemption mechanisms, enabling ETF issuers to directly deposit or withdraw cryptocurrencies without converting to cash.
- Clear disclosure rules, requiring detailed information on net asset value calculation, custody practices, insurance, benchmark selection, and service provider relationships.
- Custody standards, demanding transparency about where and how crypto assets are stored, who controls access, and what insurance protections are in place to mitigate risks.
- Fraud mitigation safeguards, addressing potential conflicts of interest.
- The SEC expects applicants to follow the registration process under the Securities Act and the Exchange Act with precise and consistent disclosures aimed at reducing delays in approval.
- The SEC has expanded position limits and options trading rules for some crypto ETFs, expecting altcoin ETFs to similarly include provisions for in-kind redemptions and enhanced market mechanisms to support liquidity and investor protection.
If Solana receives ETF approval, it would almost certainly trigger a reassessment of XRP, ADA, and AVAX ETF proposals by both issuers and regulators. The SEC's recent request for amended S-1 filings for spot Solana ETFs signals a potentially wider opening in regulatory approval.
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- Investors interested in altcoins might be eagerly awaiting the potential approval of a Solana ETF, as this could open doors for XRP, Avalanche (AVAX), and Cardano (ADA) to follow.
- For those who own Solana, consideration could be given to setting up a digital wallet for easier management and participation in the possible future Solana ETF.
- As governance is crucial in the world of cryptocurrency, the SEC's focus on transparency, insurance, and mitigation of risks in ETF approval processes could bring reassurance to potential investors.
- With the ongoing development of technology in the finance industry, exchanges could see increased activity as more altcoins, such as Solana, Bitcoin, and Ethereum, become available on ETFs.
- To navigate the complex landscape of investing in cryptocurrencies and ETFs, it's essential to stay informed about the latest trends, regulatory changes, and technological advancements through reliable sources like [Source 1], [Source 2], [Source 3], and [Source 4].
