VanEck Digital Assets Manager Matthew Sigel explains the reasons behind applying for the first Solana ETF in the United States in a tweet. They believe that Solana’s efficiency is more conducive to developing various applications, and that SOL’s functionality is no different from BTC and ETH, and should be classified in the commodity category.
As a competitor to Ethereum, Solana is an open-source blockchain software designed to handle various applications, including payments, transactions, gaming, and social interactions. Solana blockchain operates as a single global state machine without the need for sharding or L2, offering unique scalability, speed, and low-cost combinations that may provide a better user experience for various applications.
Solana can process tens of thousands of transactions per second, with very low fees, and employs an advanced security mechanism combining historical proof and proof of stake. The high throughput, low fees, strong security, and vibrant community make Solana an attractive ETF choice, providing investors with the opportunity to engage with a versatile and innovative open-source ecosystem.
They believe that Solana’s native token SOL functions similarly to other digital commodities like Bitcoin and Ethereum, used for transaction fees and computational services on the chain. The broad range of applications and services supported by the Solana ecosystem underscores the utility and value of SOL as a digital commodity, emphasizing decentralization and security.
The decentralized nature, practicality, and economic viability of SOL align with the characteristics of other existing digital commodities, reinforcing the belief that SOL could be a valuable commodity suitable for investors, builders, and entrepreneurs seeking alternatives to tech giants monopolizing app stores.
VanEck’s decisive application for the Solana ETF has sparked discussions in a sluggish market, with Matthew Sigel addressing community skepticism on Twitter. He considers it foolish to continually emphasize Solana’s absence from U.S. futures markets like CME, stating that futures markets are not crucial for price formation, as monitoring agreements shared between spot crypto exchanges can meet futures demands.