Solana CME futures tip impending US ETF approvals — Exec
The upcoming introduction of Solana’s futures contracts on the Chicago Mercantile Exchange (CME) is poised to mark a significant milestone for the asset, hinting at the forthcoming approval of Solana-based exchange-traded funds (ETFs) in the United States. Chris Chung, the founder of the Solana-centric swap platform Titan, spoke to Cointelegraph, expressing optimism regarding this pivotal development.
Starting March 17, the CME will launch SOL futures contracts, positioning itself as one of the first regulated platforms for Solana futures in the U.S. This follows the launch of similar futures by Coinbase in February, and Chung notes that the establishment of these futures is a critical step towards the approval of SOL ETFs.
Chung forecasts that the U.S. Securities and Exchange Commission (SEC) will likely greenlight spot Solana ETFs proposed by asset managers VanEck and Canary Capital as early as May. He emphasizes that the existence of regulated futures sends a clear signal to regulators about the maturation of Solana as an asset, facilitating the approval of additional financial products.
Futures contracts are essential as they are standardized agreements to buy or sell an asset at a predetermined date, and they help provide a stable benchmark for measuring a cryptocurrency’s performance. The CME has previously wrapped futures contracts for Bitcoin and Ether, which saw successes in the approval of their respective ETFs last year.
Chung asserts that the launch of Solana futures and ETFs will extend the asset’s narrative beyond the realm of memecoins—a trend that dominated Solana’s success in 2024. He anticipates a shift towards attracting “sticky capital” that could support the development of more serious real-world applications, including payments and remittances. While he acknowledges that these use cases might seem less exciting than memecoins, he describes them as a dependable revenue source that can help bolster Solana’s price during a market downturn.
Currently, trading activity related to memecoins makes up approximately 80% of Solana’s network revenues, though a decline in activity was observed in February amid various memecoin scandals that impacted retail trader sentiment. Despite this, cryptocurrency trading volumes on Solana reportedly still rival that of the entire Ethereum ecosystem, including its layer-2 scaling solutions.
Chung suggests that Solana ETFs could particularly appeal to retail investors, given ongoing challenges faced by Ethereum. Since the start of 2024, Solana’s SOL token has significantly outperformed Ether, a trend driven further by Ethereum’s struggles following the Dencun upgrade, which saw transaction fees drop by nearly 95%.
As the landscape evolves, Chung posits that with Ethereum experiencing weak price movements, Solana emerges as the primary alternative for retail investors looking to engage with cryptocurrencies beyond Bitcoin without seeking high-risk engagements. Bloomberg Intelligence has estimated a 70% chance that the SEC will approve spot ETFs for both Solana and Litecoin, underscoring the growing traction of these assets in the investment landscape.
