Institutional funds are borrowing Solana ETF to lay out at the bottom, countering the trend to support the value of SOL.

Author | Golem, Odaily

Original title: “Don’t panic, SOL Guardians, the main funds are here to support you”

Today, Bitcoin has once again fallen below $100,000, and the crypto market is in a state of extreme fear, with the fear and greed index reaching 22.

The retreat of institutional buying is one of the main reasons for the recent market decline. According to SoSoValue data, on November 13, the total net outflow of Bitcoin spot ETFs was $870 million, the second highest in history. In the past month (from October 13 to November 13), Bitcoin spot ETFs only had a net inflow for 7 days, with a monthly net outflow reaching $1.84 billion. The situation for Ethereum spot ETFs is also not optimistic. According to SoSoValue data, there were only 6 days of net inflow in the past month, with a monthly net outflow of $1.06 billion.

As the main external buying support in this round of the bull market, ETFs have been continuously selling off Bitcoin and Ethereum. Does this mean that mainstream funds in traditional finance have also lost interest in cryptocurrencies?

During the U.S. government shutdown, on October 28, the first Solana spot ETF in the U.S.—Bitwise Solana Staking ETF (ticker symbol BSOL) officially listed on the New York Stock Exchange. According to SoSoValue data, the net inflow on the first day of listing was $69.45 million. Immediately following that, on October 29, the Grayscale Solana Trust ETF (ticker symbol GSOL) was also converted from a trust to an ETF and officially listed on the New York Stock Exchange.

Currently, there are only these two Solana spot ETFs in the market. As of November 13, the total net asset value of the Solana spot ETFs is $533 million, with a Solana net asset ratio of 0.64%, and the historical cumulative net inflow has reached $370 million.

Although the total net inflow of Solana spot ETF is still less than one percent of that of Bitcoin spot ETF, under the current background of other ETFs withdrawing funds and the continuous decline in SOL prices, the fact that Solana spot ETF has maintained a net inflow for 13 consecutive days appears to be “full of confidence”.

For SOL investors, this is also a deducible positive signal. ETF funds are accumulating at the bottom of SOL and providing buying support. After completing sufficient turnover, SOL may start an independent market trend.

Why traditional financial funds are backing SOL

If we want to analyze why traditional finance is heavily buying Solana spot ETFs, the biggest possibility is that they value the staking rewards of Solana. Unlike holding Bitcoin spot ETFs, investors purchasing Solana spot ETFs can obtain additional returns. Both Bitwise and Grayscale have promised to support SOL staking and distribute the staking rewards to users.

Compared to the approximately 2% APY of Ethereum, the average 7% APY of Solana is more attractive. Bitwise's Chief Investment Officer Matt Hougan also stated, “Institutional investors like ETFs because they like income, and Solana has the highest income among all blockchains. Therefore, institutional investors prefer Solana ETFs,” and he believes that as institutional buying continues to grow, the next phase of SOL will be driven by more rational capital.

At the same time, institutions may simply be the “big players” in the market, chasing after APY. The launch of the Solana spot ETF has given institutional investors the opportunity to access higher APY crypto products. From a profit-seeking perspective, it may also siphon off buying funds from the Ethereum spot ETF in the future.

When will the SOL price rise

From the perspective of government shutdowns and weakened regulation, the launch of the Solana spot ETF came at a good time; however, from the perspective of the market environment, the launch of the Solana spot ETF is really ill-timed. Not only is the sentiment in the crypto market low, but it also coincided with a massive sell-off by whales, such as Jump Crypto, which sold over 1.1 million SOL on October 30, worth over $200 million. Since the launch of the Solana spot ETF on October 28, the price of SOL has dropped over 26%.

Since the launch of the Solana spot ETF, there has been a net inflow of $370 million, which is completely unable to digest the selling pressure resulting from multiple market factors. Macroeconomic changes and market sentiment are always difficult to predict; however, it is certain that institutions are continuously increasing their holdings of SOL through the Solana spot ETF. In the context of other crypto assets being abandoned and continuously bleeding, SOL has welcomed a more solid backing, with a well-funded institutional buying support already in place.

In general, institutional investors or ETF buyers tend to have a longer holding period than ordinary investors. Currently, as the old giants of SOL are cashing out and prices remain low, the continuous inflow of Solana spot ETFs is equivalent to institutions building positions at the bottom, making them even less likely to sell easily in the future.

In the second half of this year, mainstream cryptocurrencies such as BTC, ETH, and BNB have all broken through their previous highs, while SOL has not seen another breakthrough since reaching a price peak of 295 USD in January this year. One of the main reasons is the heavy profit-taking. From October 2024 to January 2025, in just three months, SOL rose from 152 USD to 295 USD, with an increase of nearly 100%. Now, as the previous profit-taking on SOL gradually “clears out”, new and more determined structural buying will create a future upward channel for SOL.

For ordinary investors, a decline brings pain, but it can also create a “golden pit.”