Solana ETF Fee War Kicks Off As Bitwise Proposes 0.20% Charge
Bitwise has amended its filing for a spot Solana ETF and set a 0.20% management fee, signaling a potential SOL ETF fee war before launches even begin.
The proposed fee is well below the higher fees that frequently are charged at launch, likely reflecting a strategic move to capture investor inflows from the start. It pressures other issuers to follow suit or risk losing market share.
“Bitwise not playing around, plans to charge just 0.20% for their spot Solana ETF,” said Bloomberg ETF analyst Eric Balchunas on X. “Thought we’d see higher first, need war to get this low.”
Bitwise also said that its Solana ETF will come with staking, giving investors extra income that will not be solely dependent on SOL’s price movements.
Bitwise Move A Good Sign For Spot Solana ETF Inflow Potential
Blachunas said that products that were launched with low fees “have a near-perfect record of attracting investors,” and added that low fees are “a good sign for inflows potential.”
Other bidding issuers could soon enter into a spot Solana ETF fee war with Bitwise to capture the lion’s share of those potential inflows, similar to what happened after the launch of spot Bitcoin ETFs.
In January 2024, VanEck waived all fees for its spot BTC ETF in an effort to attract investors. It then extended its waiver through January 2026 for up to $2.5 billion in assets under management.
Meanwhile, Grayscale introduced a low annual sponsor fee of 0.15% for its Bitcoin Mini Trust.
Fees for existing crypto ETFs typically range between 0.15% and 0.25%.
Following the launch of spot Bitcoin ETFs in the US last year, billions of dollars have flown into the products, data from Farside Investors shows.
First SOL ETF Has Already Launched In The US
There is already a futures-based Solana ETF trading in the US. The REX-Osprey Solana Staking ETF (SSK) was launched on July 2, and recorded $12 million in inflows on its first trading day. This product charges a 0.75% fee. SSK’s cumulative inflows stand at $367 million as of Oct. 8.
SSK flows (Source: Farside Investors)
Balchunas believes that Bitwise’s proposed ETF will be a better product than SSK, which he said is “riddled with tracking issues like a futures ETF.” The REX-Osprey ETF also “trails spot Solana by 12%,” he said.
Solana ETFs with staking proposed by Bitwise and other bidding issuers could receive the regulatory nod by mid-October, according to a Sept. 26 prediction by ETF analyst Nate Geraci. However, the ongoing US government shutdown could delay the launch of these products, especially as the SEC operates with reduced staff.
The agency said in its recent “Operations Plan” that it “will not review and approve applications for registration by entities.” It added that it will also not review and approve “new financial products” or “self-reulatory organization rule changes.”
Geraci has said that “a prolonged government shutdown would definitely impact the launch of new spot crypto ETFs.”
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