Canadian digital asset manager 3iQ is making waves with a groundbreaking filing. The firm submitted a preliminary prospectus for “The Solana Fund (QSOL)” on the Toronto Stock Exchange (TSX), potentially launching the first North American exchange-traded product (ETP) focused on Solana (SOL).
If approved, QSOL would offer investors a simple way to gain exposure to Solana’s digital currency (SOL) and its daily price movements against the US dollar. This eliminates the technical complexities of directly acquiring and managing SOL tokens.
Staking Rewards and Secure Custody
An enticing feature of QSOL is the potential to earn staking rewards. 3iQ estimates these rewards to be in the range of 6-8%, generated from the underlying Solana holdings. To ensure the security of investor assets, Coinbase Custody and Tetra Trust will act as custodians, with Coinbase providing dedicated institutional-grade staking infrastructure for the Solana fund.
Building on a Strong Foundation
This isn’t 3iQ’s first foray into cryptocurrency ETFs. They already manage two successful products on the TSX – the 3iQ Bitcoin ETF (BTCQ) and the 3iQ Ether Staking ETF (ETHQ) – with over $271 million in combined net assets under management (as of June 20, 2024). They also offer The Bitcoin Fund (QBTC) and The Ether Fund (QETH) for even broader crypto investment options.
Canada has a proven track record of embracing innovative cryptocurrency products. In February 2021, they became the first jurisdiction globally to approve spot Bitcoin ETFs, followed by spot Ether products two months later. Notably, this occurred before the US even launched futures ETFs for either asset.
Global Solana Market and Potential US Competition
While 3iQ’s QSOL appears to be a first in North America, over $1 billion worth of Solana ETPs already exist worldwide. Products like the 21Shares Solana Staking ETP and ETC Group Physical Solana in Europe demonstrate established global interest in Solana-based investments. As for the US market, while asset managers like Franklin Templeton have shown interest in the Solana network, concrete plans for a spot Solana ETF haven’t materialized yet.
3iQ’s filing for the QSOL ETP signifies a potential turning point for North American crypto investment. If approved, it would offer a convenient and regulated way for investors to participate in the growth of the Solana ecosystem. This move could pave the way for even broader acceptance and innovation within the North American cryptocurrency landscape.
