SEC rejects Solana ETF’s 19b-4 filing
The Block reported, citing sources familiar with the matter, that the U.S. Securities and Exchange Commission (SEC) has rejected two 19b-4 application documents for the Solana spot ETF submitted by Cboe BZX, so these documents will be withdrawn from the Cboe website.
According to Zombit’s previous reporting, the SEC expressed concerns about Solana’s nature as a security in conversations with potential ETF issuers before Cboe removed the relevant 19b-4 filing from its website. After discussions, the SEC and Cboe agreed not to submit the 19b-4 filing to the Federal Register because that would trigger an approval process that would put pressure on the SEC, people familiar with the matter said.
19b-4 filings are filed by an exchange (in this case, Cboe) on behalf of an issuer (in this case, 21Shares and VanEck), which, if included in the Federal Register, initiates the SEC approval process. However, because the SEC rejected the 19b-4 filings, this means they were never included in the Federal Register and therefore did not open a potential approval or denial process.
Solana ETF faces SEC headwinds
The two issuers applying for the Solana ETF are 21Shares and VanEck. It appears that 21Shares has suspended its order for a filing, S-1, or prospectus, because the document has been removed from the SEC's filing system, EDGAR. However, VanEck's S-1 filing still exists, and its head of research Matthew Sigel said the application is still in progress, meaning VanEck has not given up on applying for the Solana ETF.
Although the rejection of the 19b-4 filing is bad news for the issuer, the issuer may still refile or amend it in the near future to include stronger arguments that Solana is not a security. Audrey Belloff, Director of Communications at 21Shares said:
"We are unable to comment on the regulatory process at this time. We remain committed to expanding investor access to cryptocurrencies in the U.S. and global markets."
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