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- Institutional demand has increased, with predictions showing an 88% probability for spot Solana ETF approval and further market interest.
- The Solana derivatives market has seen significant activity, with futures trading volume up 71.93% to $8.32 billion and open interest rising to $3.92 billion.
Solana’s (SOL) price jumped over 5% on Thursday, rising to a high of $135.93 as investors responded to the imminent availability of SOL futures exchange-traded funds (ETFs). The action follows increased institutional buying and rising optimism over a probable spot Solana ETF approval from the U.S. Securities and Exchange Commission (SEC), as covered in our previous report.
Volatility Shares Launches Solana Futures ETFs
Volatility Shares, an American investment company that focuses on leveraged ETFs, is launching the initial Solana futures ETFs on Thursday. Two products will be available: the Volatility Shares Solana ETF (SOLZ), which will track Solana futures, and the Volatility Shares 2X Solana ETF (SOLT), offering leveraged exposure. As per filings, the funds’ expense ratios will be 0.95% and 1.85%, respectively.
After the announcement, Solana’s price hit a 10-day high, rebounding from its recent low of $121. The robust market reaction indicates higher investor optimism regarding the asset’s future prospects.
The announcement of Solana futures ETFs comes after a regulatory trend seen with Bitcoin and Ethereum, as futures-based ETFs were approved ahead of spot ETFs. This has encouraged traders to increase the chances of a spot Solana ETF approval, with crypto prediction platform Polymarket now pricing in an 88% probability.
To this momentum, Donald Trump, former President of the U.S., recently added Solana to a suggested crypto strategic reserve, increasing institutional interest even more. Bloomberg analysts have also revised their estimates, now predicting a 75% likelihood of a spot Solana ETF being approved in 2025. With anticipation increasing, corporate investors can also expand their SOL exposure, which will support further price growth.
Solana Derivatives Market Sees Increased Activity
The Solana futures ETF launch coincides with the fifth anniversary of the blockchain and follows price volatility associated with FTX creditors’ repayments. In spite of these issues, derivatives data indicates a bullish trend.
Solana futures trading volume has surged 71.93% over the last 24 hours to $8.32 billion, marking increased participation by institutional and retail traders. Moreover, according to Coinglass stats, open interest has risen 3.82% to $3.92 billion, indicating new positions prior to the ETF.
Options trading volume fell 17.08%, while options open interest rose 10.97% to $8.98 million. This reflects a rise in leveraged wagers on Solana’s price action.
Major Bullish Market Sentiment Reigns Trading Activity
There are indications of strong bullish sentiment in the markets, as mentioned in our previous report. The Binance and OKX long/short ratio still leans long, with the largest traders on Binance registering a 2.29 ratio to favor longs.
However, liquidations data from Coinglass indicate $21.94 million worth of rekt positions within the last 24 hours, which short sellers dominate. In case the uptrend continues, squeeze of short positions is possible and could lead to another rally. With institutional demand increasing and approval chances for spot ETFs closing in on 90%, traders are still waiting for Solana’s next possible breakout.
