The SEC recently rejected two Solana ETF filings, halting the approval process.
The outcome of the 2024 U.S. presidential election will likely be a major driver for further approvals.
Analysts are largely pessimistic about Solana's chances under the current administration—even more so if Harris becomes president.
Solana's price has been under pressure, with support levels at $140 and $118.
The Bulls must reclaim the $140 zone if Solana is to have any chance at a rebound soon.
Since the Bitcoin and Ethereum ETFs' approval, launch, and success, Solana has been the next cryptocurrency in line.
Speculation continued throughout the first two quarters of the year, and since the approval of the Ethereum ETFs on 23 July, investors believed that Solana's debut was only a matter of time.
However, fast-forward nearly a month after the Ethereum ETF approvals, and the approval outlook now seems very bleak.
Here's what's been up with the Solana spot ETF speculation and what the experts are saying about it.
The SEC rejected the current Solana ETF filings this week, specifically the preliminary 19b-4 filings submitted on the Chicago Board Options Exchange (CBOE) from VanEck and 21 Shares.
This rejection threw cold water on the review process entirely, killing it before it could even begin.
As it stands, both filings have now been removed from the CBOE website.
This also means that these filings never made it to the Federal Register, and as such, they are currently in no progress towards approval or denial.
ETF analysts have been very open about their thoughts about this development.
One of these is Bloomberg’s Eric Balchunas, who posted a flowchart illustrating the Solana ETFs’ failure to move beyond the second step.
Balchunas wasted no time stating, "[the ETFs have] a snowball's chance in hell of approval unless there's a change in leadership.”
He further mentioned that there was a "near-zero chance in 2024, and if Kamala Harris wins, there's probably a near-zero chance in 2025, too.”
This simply means that the approval of Solana ETFs (and other crypto-related policies) depends on the political leadership in the U.S. and Donald Trump's chances of winning the tight race against Harris in the 2024 election.
The political landscape in the U.S. also presents an even more complex scenario for these ETFs.
Only a few days ago, there was some speculation about Harris appointing the current SEC chair, Gary Gensler, to the role of U.S. Treasury Secretary.
This move could strengthen the agency's harsh stance against crypto. If there had been a low chance of a Solana ETF before, the odds would have gravitated further towards impossibility.
Nate Geraci, President of the ETF Store, agreed with Balchunas via a tweet, in which he stated that there will be "No [Solana] ETF until either CME-traded [Solana] futures exist, or Congress puts [a] legit crypto regulatory framework in place."
However, while the outlook looks grim, other experts like Matthew Sigel, VanEck’s head of digital asset research, remain determined.
Despite everything, Solana continues to struggle with price action and has declined further from the $163 local high, as illustrated.
Solana’s price hurdles
According to the RSI on the daily chart, the bears may have the upper hand and have pulled the cryptocurrency down below its 50-day SMA to the $141 zone where it now sits.
The chart also shows that the $140 price level is a fairly strong support, which means that the bulls will need to push slightly harder to rebound off this zone.
However, if we see a break below $138, the resulting dip might bring the cryptocurrency down to a retest of the $118 price level before a rebound.
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