11th June 2025 > > Crypto Task Force & spot SOL ETFs.

tl;dr

The fifth and final Crypto Task Force took place on the topic of DeFi. Spot SOL ETFs look to be nailed on, but the timing is uncertain.

Market Snap

Market Wrap

All eyes would be on the Senate today, as the GENIUS act gets a vote. But not the final one – this vote is to decide whether to close the debate or not, and then move to a final vote. Circle’s ongoing price appreciation tells us that GENIUS is a done deal, just not yet.

This week has already seen another $8.2bn inflows to the spot BTC ETFs, dwarfing last week’s minor wobbles.

Curious Cryptos’ Commentary – Crypto Task Force

The fifth and final roundtable has been held on the topic of “DeFi and the American Spirit”, which will get the naysaying progressives suitably wound up.

Recently appointed Chair of the SEC, Paul Atkins, crypto supporter, and all-round good egg, opened the session with this speech:

https://www.sec.gov/newsroom/speeches-statements/atkins-remarks-defi-roundtable-060925#:~:text=An%20innovation%20exemption%20could%20help,technologies%20in%20the%20United%20States

To make the point Paul starts:

“This is an apt title because the American values of economic liberty, private property rights, and innovation are in the DNA of the DeFi, or Decentralized Finance, movement.”

Paul’s view of the current inadequacies of the regulatory regime is laid bare:

“I do not believe that we should allow century-old regulatory frameworks to stifle innovation with technologies that could upend and most importantly improve and advance our current, traditional intermediated model.  We should not automatically fear the future.”

The ground-breaking proposal is this one:

“An innovation exemption could help fulfill President Trump’s vision to make America the “crypto capital of the planet” by encouraging developers, entrepreneurs, and other firms that are willing to comply with to (sic) certain conditions to innovate with on-chain technologies in the United States.”

There you have it, a safe harbour free from risk of prosecution for innovators and entrepreneurs under some strictly controlled conditions. Those who would deny freedom and liberty had Gensler as Chair of the SEC, for a while. Paul is our man, and his positive impact on the world will be so much greater than Gensler could ever dream of negating.

Curious Cryptos’ Commentary – Spot SOL ETFs

The SEC, under its new and inspirational management, has asked the proposers of spot SOL ETFs to submit amended S-1 forms within the week, after which it will provide feedback within thirty days.

The key areas that the SEC wants to address are very interesting.

First, the issue of in-kind redemptions. All the BTC and ETH ETFs currently prohibit in-kind redemptions, a feature that is allowed in other asset ETFs. It’s omission is a hangover from Gensler’s final desperate attempts to torpedo the launch of spot BTC ETFs, of which he was never a supporter. Allowing in-kind redemptions would make for a more efficient market, to the benefit of all investors, and hence lowering the cost of capital for society as a whole, and improving productivity, admittedly at the margins in this case. It isn’t a critical issue, but it is a nice to have.

The second one though is truly innovative – the prospect of allowing staking within the ETF. The spot ETH ETFs, despite their recent sudden about-turn in popularity amongst investors for the better, suffer from being unable to stake the ETH held as collateral against the ETF. This adds an effective 3%-4% or so annual charge to holding the ETF versus holding the asset itself, a charge that compounds on a daily basis, assuming immediate re-staking of all staking rewards, the default position for most investors.

I think we can be very confident that spot SOL ETFs are heading our way, armed with staking, opening up investments into SOL to a vastly larger audience than before. Which can only have one impact on the price, all other things being equal. The question is: when does this happen?

James Seyffart, Bloombert analyst for all things ETF, who often has a good handle on crypto ETF developments, offers a word of a caution on X:

“ (The SEC) Takes time to do things. Its still a government agency and still a lot of minutiae details to get through. Also crypto isn't the only thing they're working on. its standard practice for SEC to take the full time to decide these things.

An early decision would be out of norm”