The US Securities and Exchange Commission (SEC) will reportedly reject two spot Solana (SOL) exchange-traded funds (ETF) applications, according to Bloomberg ETF senior analyst Eric Balchunas.

Balchunas said the rejections were Chair Gary Gensler’s “parting gift” to the crypto industry.

Fox News reported Eleanor Terrett revealed sources at two Solana ETF issuers told her the SEC will not approve any new crypto-related ETF under Gensler. He is slated to step down on Jan. 20, 2025.

Balchunas expects the issuers to file for the Solana ETFs again once Paul Atkins begins his term as SEC chair. President-elect Donald Trump confirmed Atkins for the role on Nov. 27.

In response to the news, former VanEck digital asset strategy director Gabor Gurbacs commented that Gensler “will take a hike soon,” and Balchunas replied:

“This was his parting gift I guess.”

However, Balchunas’ fellow Bloomberg ETF analyst James Seyffart argued that Gensler had no choice on the Solana ETF matter, as it would be “disingenuous” to allow SOL-related exchange-traded products while the regulator claims the crypto is a security in multiple lawsuits.

As a result, the new SEC administration will be responsible for sorting out the crypto lawsuits where SOL is considered a security. Until then, Seyffart sees applications as “dead in the water” until the watchdog decides on a new course of action. 

This pushes back the Solana ETF approval timeline, which Seyffart initially projected to conclude in August 2025. Nevertheless, he added that this was the earliest of the deadlines, and he expected it would be pushed back.

Two gifts

Seyffart also highlighted that the SEC’s recent brief on the Binance case is the real parting gift, which he argued was an unnecessary move for the regulator.

Ripple’s chief legal officer, Stuart Alderoty, recently shared that the regulator filed an 81-page document urging the court not to dismiss the Binance lawsuit that accuses the exchange of offering 11 tokens as investment contracts.

According to Alderoty:

“Instead of standing down and pausing crypto litigation with new leadership just weeks away, Gensler’s SEC filed an 81-page brief in the Binance case yesterday, recycling the same failed arguments — including the absurd (and unsupported) claim that crypto has no inherent value.”

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