Fidelity Investments has filed a pre-effective amendment for its Solana ETF with the Securities and Exchange Commission, moving the registration toward automatic effectiveness.
The filing reveals the fund will stake all its SOL holdings to generate returns exceeding the Fidelity Solana Reference Rate while charging a 0.25% annual fee, fully waived for the first six months after launch.
This update pushes Fidelity into a rapidly expanding Solana ETF market, which has already seen three products debut on U.S. exchanges, capturing combined first-day inflows exceeding $81 million.
Fidelity Structures Aggressive Staking Strategy
The Fidelity Solana Fund will stake up to 100% of its SOL tokens through custodians Anchorage Digital, BitGo, and Coinbase Custody, with node operators including Coinbase Crypto Services and Figment.
Staking rewards will be subject to a 15% fee split among the sponsor, custodians, and operators, with the Trust expected to unstake SOL within two days when needed for redemptions.
The fund will trade under ticker FSOL on an undisclosed exchange, offering creation and redemption baskets of 25,000 shares settled in either SOL or cash.
To support this dual-settlement approach, Fidelity has secured trading agreements with counterparties, including Cumberland DRW, Jane Street Capital affiliates, and Virtu Americas, to facilitate cash creations.
Despite the ambitious structure, the filing acknowledges substantial regulatory risk, noting the SEC has previously classified SOL as a security in enforcement actions. However, some cases have been dismissed or settled.
The registration warns that a definitive security classification could trigger immediate material impact on SOL’s trading value and potentially force the fund’s liquidation.
Bitwise Dominates Early Market
While Fidelity prepares to enter, early movers have already claimed significant market share.
Bitwise’s Solana ETF captured $69.5 million on its October 28 debut, nearly six times the $12 million raised by Rex-Osprey’s competing product.
The Bitwise Solana Fund stakes 100% of holdings in-house to deliver the network’s full yield while charging a 0.20% management fee, waived for three months.
Just one day later, Grayscale launched its Solana Trust ETF on NYSE Arca, converting a 2021-vintage private trust holding 525,387 SOL tokens.
The fund carries a 0.35% expense ratio and stakes 74.89% of assets, passing 77% of staking rewards to investors on a net basis.
Meanwhile, Rex-Osprey’s SSK employs a hybrid structure holding 54% in direct Solana, 43.5% in a Swiss-listed CoinShares ETP, with the remainder in JitoSOL and cash.
The fund distributes monthly staking rewards, which are treated as a return of capital for tax purposes, while charging a 0.75% expense ratio.
Institutional Appetite Tests Layer 1 Power Balance
Speaking with Cryptonews, Maria Carola, CEO of StealthEX, views the Solana ETF wave as a defining moment in blockchain competition.
“The launch of a spot ETF on Solana is a signal that has broken out in the protracted battle for dominance in the Layer 1 blockchain space,” she said.
“For the first time, institutional investors are being invited to consider Solana as a standalone macro asset.“
Carola notes projections of $3 billion in ETF inflows over 12-18 months depend on Solana maintaining its 2024 momentum in DeFi expansion and network stability.
“Solana’s story is one of speed, scalability, and engineering precision, but for many market participants, it remains a symbol of short-term liquidity cycles and the fleeting hype of meme tokens,” she said. “An ETF alone won’t change this perception overnight.“
She acknowledges Ethereum’s commanding position, with over $60 billion locked in DeFi and a mature staking ecosystem that continues to attract institutional capital seeking predictability.
“In the long term, it’s Ethereum’s fundamentals, such as stability, institutional reputation, and integration into the global financial system, that maintain its leadership,” Carola said.
However, she proposes a coexistence model in which “Ethereum serves as the underlying trust and settlement layer in the on-chain economy, while Solana becomes its high-performance execution engine.“
Despite positive sentiment around ETF launches, SOL’s near-term price action remains unclear.
Polymarket gives Solana just a 25% chance (down 2% from yesterday) of reaching a new all-time high before 2026, with SOL trading at $196, up nearly 1% over 24 hours.
Beyond U.S. markets, the Solana ETF momentum follows Hong Kong’s October approval of China Asset Management’s spot fund, which began trading on October 27 with a $100 minimum investment.
The post Wall Street’s Solana Bet Advances as Fidelity Updates ETF Filing appeared first on Cryptonews.
