Institutional activity surrounding Solana (SOL) has intensified in recent days, with major market participants making strategic moves ahead of key events. Crypto market maker Wintermute recently withdrew nearly $40 million worth of SOL from Binance, just days before a $2 billion token unlock set for March 1, which will introduce 11.2 million new tokens into circulation. At the same time, speculation is growing over BlackRock’s absence from the Solana ETF race, despite several major firms, including Franklin Templeton, Bitwise, and Grayscale, filing for a spot Solana ETF.
BlackRock’s Silence on Solana ETF Sparks Speculation Amid Growing Institutional Interest
As the race to bring the next major altcoin exchange-traded fund (ETF) to market intensifies, one glaring absence from the conversation is BlackRock. Despite being the world's largest asset manager with $11.6 trillion in assets under management (AUM), BlackRock has yet to signal any intent to file for a Solana (SOL) ETF, leaving industry experts and investors wondering whether the financial giant will make a move.
BlackRock has established itself as a dominant force in the crypto ETF landscape. The asset management firm’s iShares brand already controls the two largest spot cryptocurrency ETFs in the market: the iShares Bitcoin Trust ETF (IBIT), which boasts a staggering $55.4 billion AUM, and the iShares Ethereum Trust ETF (ETHA), holding $3.7 billion AUM. Both funds have seen strong institutional adoption, with BlackRock’s IBIT leading the charge in Bitcoin ETFs, as approximately 1,100 institutions currently hold 247 million shares in the fund.
With Franklin Templeton, Grayscale, Bitwise, and 21Shares having already submitted applications for a Solana ETF, many industry participants have been waiting for BlackRock to join the fray. However, the firm's silence on the matter has fueled speculation about its broader strategy regarding alternative crypto assets.
Rachel Aguirre, Head of US iShares Product at BlackRock, addressed the firm's ETF strategy in an interview with Bloomberg TV but stopped short of confirming any plans to launch a Solana ETF. Instead, she reiterated that BlackRock follows a strict three-principle approach when considering new investment products:
Client Demand: BlackRock focuses on evaluating whether investors have a strong interest in a specific asset before developing an ETF around it.
Investment Thesis: Aguirre highlighted that not all cryptocurrencies are created equal, and each must be assessed based on its long-term potential and underlying fundamentals.
Suitability for an ETF Wrapper: Factors such as liquidity, transparency, and market structure play a key role in determining whether an asset can support an ETF product.
This cautious and methodical approach suggests that while BlackRock may not be ruling out a Solana ETF, it is in no rush to launch one unless the conditions align with its stringent evaluation criteria.
One of the most significant hurdles facing Solana ETFs is regulatory uncertainty. The US Securities and Exchange Commission (SEC) has yet to formally clarify Solana’s classification. If the SEC deems SOL a security, it could dramatically complicate the ETF approval process. The classification would shift Solana ETFs into a different regulatory framework, requiring a more rigorous review process compared to Bitcoin (BTC) and Ethereum (ETH) ETFs, both of which operate under commodity-based investment structures.
Earlier this year, SEC Chair Gary Gensler emphasized that while Bitcoin has been largely accepted as a commodity, Ethereum's status remains in flux—and the same uncertainty applies to Solana. Given that Solana was specifically named in the SEC’s lawsuits against Binance and Coinbase as an example of an unregistered security, it remains to be seen how the regulatory body will approach ETF applications tied to SOL.
According to Bloomberg ETF analysts, Solana ETF approval currently sits at a 70% likelihood, meaning that while optimism exists, there are still notable risks involved. Should regulatory headwinds intensify, applicants like Franklin Templeton and Bitwise could face setbacks.
Despite regulatory uncertainties, institutional interest in cryptocurrency ETFs has been growing at a steady pace. Data from Q3 2024 indicates that institutional ownership in Ethereum ETFs surged to 14.5%, reflecting growing confidence in ETH as an investment vehicle. Meanwhile, Bitcoin ETF ownership saw a slight decline from 22.3% to 21.5%, although BlackRock’s IBIT remains the dominant player in the space.
With institutions showing an increasing appetite for digital asset exposure through regulated investment vehicles, the demand for Solana ETFs is expected to grow. Solana, often touted as the "Ethereum killer", has solidified itself as a top-tier blockchain with high transaction speeds, low fees, and a growing DeFi and NFT ecosystem. Its market positioning makes it an attractive candidate for an ETF, assuming regulatory hurdles can be overcome.
What’s Next for BlackRock and the Solana ETF Market?
While BlackRock has not ruled out a Solana ETF, its deliberate silence suggests that the firm may be taking a wait-and-see approach. Given the firm’s massive influence, its eventual entry into the Solana ETF space could serve as a strong signal for institutional investors, potentially accelerating mainstream adoption of SOL.
In the meantime, all eyes will be on the SEC and how it chooses to handle the classification of Solana. If regulatory clarity emerges and institutional demand continues to rise, BlackRock may find itself compelled to enter the race, solidifying its position as the leader in cryptocurrency ETFs.
For now, Franklin Templeton, Grayscale, Bitwise, and other applicants will attempt to pave the way for a spot Solana ETF—but without BlackRock in the mix, the market still awaits its most powerful potential player.
Wintermute Withdraws $40M in Solana Ahead of Massive Token Unlock: Market Faces Potential Sell-Off
In related news, crypto market maker Wintermute has withdrawn nearly $40 million worth of Solana (SOL) from Binance in the past 24 hours, stirring speculation in the cryptocurrency market just one week before the largest token unlock in Solana’s history. The withdrawal, which Arkham Intelligence data confirms took place before 9:02 am UTC on Feb. 24, coincides with a sharp 7.5% drop in Solana’s price, bringing it down to $155—its lowest level in over three months.
This development has fueled concerns that Solana may face significant sell-side pressure due to an impending $2 billion token unlock scheduled for March 1. With over 11.2 million SOL set to enter circulation, traders and analysts are bracing for increased volatility in the coming days.
The Solana network is preparing for one of its most significant token unlock events, which will inject millions of previously locked SOL into the open market. Over the next three months, an estimated 15 million SOL (worth approximately $2.5 billion) will be unlocked and made available for trading.
Much of this supply stems from the FTX estate’s auctions, where firms such as Galaxy Digital, Pantera Capital, and Figure acquired substantial amounts of SOL at an average price of $64 per token. Given that Solana is currently trading well above that level, these firms stand to make billions in unrealized profits once their allocations become liquid.
Crypto analyst Artchick.eth highlighted the looming inflationary effect of the unlock event, warning that an additional $1 billion worth of SOL will also be released into circulation due to Solana’s ongoing emissions schedule. The combination of unlocked tokens and natural inflation could lead to increased selling pressure in the short term.
The largest concern among traders is that venture capital (VC) firms and institutional investors who purchased SOL at a discount will begin offloading their holdings to capitalize on their profits.
Crypto trader RunnerXBT described the current period as “dangerous” for SOL buyers, emphasizing that firms like Galaxy Digital, Pantera, and Figure could collectively realize massive gains from their FTX-acquired holdings:
Galaxy Digital stands to gain $3 billion from their SOL holdings.
Pantera Capital is in line for $1 billion in profits.
Figure could make $150 million once their allocation unlocks.
With such high levels of unrealized gains, the incentive for these firms to sell at least a portion of their holdings is strong—especially in a market that has already begun pricing in concerns about supply dilution.
The recent 7.5% price decline in Solana suggests that some investors may already be front-running the anticipated selling pressure. The drop to $155 per SOL, the lowest level since November 2024, signals waning confidence as the unlock event nears.
Historically, large unlock events have led to temporary price corrections in crypto assets, as increased supply meets existing demand. If significant selling does occur, Solana could see further downside pressure, potentially testing lower support levels.
Regulatory Uncertainty and Market Sentiment Weigh on Solana
Beyond the upcoming token unlock, regulatory uncertainties and recent market scandals have further clouded Solana’s near-term outlook. The US Securities and Exchange Commission (SEC) has yet to make a definitive ruling on Solana’s classification as a security, a key factor that could impact future institutional adoption and potential Solana ETF filings.
Meanwhile, the recent Libra (LIBRA) meme coin scandal, which saw over $107 million in liquidity siphoned by insiders, has damaged investor trust in the Solana ecosystem. The scandal triggered a 94% price collapse for LIBRA within hours, wiping out $4 billion in investor capital. This negative market sentiment could further impact Solana’s price action as the unlock date approaches.
With Solana’s largest-ever token unlock just days away, the key question remains: How much of this newly unlocked supply will actually be sold on the open market? While some investors believe that large institutional holders may stagger their selling to avoid extreme price volatility, others warn that an aggressive sell-off could push SOL significantly lower in the short term.
As Wintermute’s $40 million withdrawal from Binance indicates, major market players are already making strategic moves ahead of the unlock event. Whether this is a sign of accumulation or a precursor to distribution remains to be seen, but traders should prepare for heightened volatility in the days ahead.
