• Press Releases
    • Submit a press release
    • Read All
  • Contact us
Advertise
Bitcoinist.com
No Result
View All Result
  • Bitcoin
    • News
    • Price
    • Businesses
    • Acceptance
    • Technology
    • Investment
    • Regulation
    • Reviews
    • All Bitcoin News
  • Altcoins
    • News
    • Price
    • Ethereum
    • Ripple
    • Litecoin
    • EOS
    • NAGA
    • All Altcoin News
  • Tech
    • Blockchain
    • Security
    • FinTech
    • Price
      • Bitcoin Price
      • Ethereum Price
      • Binance Coin Price
      • Litecoin Price
  • Industry
    • Industry News
    • Press Releases
  • How to
    • Buy gift cards/mobile Top Ups with Cryptos
    • What Is Bitcoin?
    • Best Bitcoin Wallet
    • Bitcoin vs Ethereum
    • Why Use Blockchain Technology?
    • Bitcoin Cash ABC vs. Bitcoin Cash SV
    • How to Buy Cryptocurrency
    • How to do Crypto Gambling
      • Crypto Casinos
        • Ethereum Casinos
        • Solana Casinos
        • LiteCoin Casinos
        • DogeCoin Casinos
        • Live Crypto Casinos
        • New Casinos
        • Instant Withdrawal Casinos
        • Cash App Casinos
        • No KYC Casinos
        • VPN Casinos
        • Offshore Casinos
          • Crypto Casinos IT
          • Crypto Casinos ES
            • All Guides
          • Crypto Casinos JP
          • Crypto Casinos SG
          • Crypto Casinos MY
          • Crypto Casinos KR
          • No GAMSTOP Casinos in UK
          • No Cruks Casinos NL
      • Crypto Betting
        • No ID sportsbooks
    • Play Crypto Games
      • Crypto Poker
      • Crypto Slots
      • Crypto Blackjack
      • Crypto Crash Gambling
        • Aviator Sites
      • Plinko
    • Bitcoin Mining
    • Best Bitcoin Brokers
    • Best Bitcoin Forex Brokers
    • How To Earn Bitcoin
    • What is Facebook Libra?
    • Ripple and XRP: The Complete Guide
  • Events
  • Play Games
Breaking News: Is The Approval Of Crypto ETFs At Risk? SEC Operations Frozen By Gov. Shutdown
  • Bitcoin
    • News
    • Price
    • Businesses
    • Acceptance
    • Technology
    • Investment
    • Regulation
    • Reviews
    • All Bitcoin News
  • Altcoins
    • News
    • Price
    • Ethereum
    • Ripple
    • Litecoin
    • EOS
    • NAGA
    • All Altcoin News
  • Tech
    • Blockchain
    • Security
    • FinTech
    • Price
      • Bitcoin Price
      • Ethereum Price
      • Binance Coin Price
      • Litecoin Price
  • Industry
    • Industry News
    • Press Releases
  • How to
    • Buy gift cards/mobile Top Ups with Cryptos
    • What Is Bitcoin?
    • Best Bitcoin Wallet
    • Bitcoin vs Ethereum
    • Why Use Blockchain Technology?
    • Bitcoin Cash ABC vs. Bitcoin Cash SV
    • How to Buy Cryptocurrency
    • How to do Crypto Gambling
      • Crypto Casinos
        • Ethereum Casinos
        • Solana Casinos
        • LiteCoin Casinos
        • DogeCoin Casinos
        • Live Crypto Casinos
        • New Casinos
        • Instant Withdrawal Casinos
        • Cash App Casinos
        • No KYC Casinos
        • VPN Casinos
        • Offshore Casinos
          • Crypto Casinos IT
          • Crypto Casinos ES
            • All Guides
          • Crypto Casinos JP
          • Crypto Casinos SG
          • Crypto Casinos MY
          • Crypto Casinos KR
          • No GAMSTOP Casinos in UK
          • No Cruks Casinos NL
      • Crypto Betting
        • No ID sportsbooks
    • Play Crypto Games
      • Crypto Poker
      • Crypto Slots
      • Crypto Blackjack
      • Crypto Crash Gambling
        • Aviator Sites
      • Plinko
    • Bitcoin Mining
    • Best Bitcoin Brokers
    • Best Bitcoin Forex Brokers
    • How To Earn Bitcoin
    • What is Facebook Libra?
    • Ripple and XRP: The Complete Guide
  • Events
  • Play Games
Bitcoinist.com
No Result
View All Result
Breaking News: Is The Approval Of Crypto ETFs At Risk? SEC Operations Frozen By Gov. Shutdown
Solana SOL news

Spot Solana ETF Proposal Clouded By VanEck’s Wash Trading Concerns

Jake Simmons
by Jake Simmons
11 months ago
·
Posted in Solana
Trusted Editorial content, reviewed by leading industry experts and seasoned editors. Ad Disclosure

VanEck’s proposed spot Solana (SOL) exchange-traded fund (ETF) is facing scrutiny due to concerns over wash trading and the nature of on-chain activity. Matthew Sigel, Head of Digital Assets Research at VanEck, published an in-depth analysis on Tuesday, comparing SOL’s metrics with those of Ethereum to provide context and clarity.

Solana has been recognized for its high throughput and low transaction costs, attracting a significant number of users and developers. With approximately 111 million monthly active wallets, it vastly surpasses Ethereum’s 5.4 million. However, skeptics argue that a large portion of these wallets may be Sybil accounts—fake identities created to manipulate metrics.

Does Solana Have A Wash Trading Problem?

In his analysis, Sigel acknowledges the challenge in distinguishing between organic user activity and that stemming from single users controlling multiple wallets. “We do agree that a very large portion of these wallets are not organic,” he states.

The analysis reveals that memecoin and non-fungible token (NFT) activities constitute a significant portion of Solana’s revenue. Approximately 34.3% of Solana’s revenues are derived from these sources, compared to 6.6% for Ethereum in the current year and 20.3% for Ethereum during its peak memecoin activity between July and October 2021.

Related Reading: Solana DeFi Growing, Daily Users Approaching 7 Million: Will SOL Crack $200?

When assessing wash trading—a practice where traders buy and sell the same asset to artificially inflate volumes—Solana’s figures are notably higher. An estimated 41.4% of memecoin and NFT volume on Solana is attributed to wash trading. In contrast, Ethereum’s wash trading for these assets stands at 28.9% in 2024 and was 44.4% during its 2021 peak.

“Putting it together, we assess that 14.2% of Solana revenues come directly from wash trading compared to 2% for Ethereum in 2024 and 9% in mid-2021,” Sigel notes. He adds a crucial caveat: the analysis assumes that memecoin wash trading generates miner extractable value (MEV) in line with normal trading. Without MEV on these trades, the estimates would fall by 50%.

To conduct this analysis, the study utilized Dune Analytics queries of both Solana and Ethereum blockchains to accumulate memecoin and NFT activity over specified periods. MEV and transaction fee data were sourced from Artemis, Jito, and Flashbots to evaluate each chain’s gas fee revenue and MEV. For wash trading identification, the analysis employed a threshold ratio of daily trading volume to a coin’s market capitalization.

Related Reading: BREAKING: Canary Capital Files For Spot Solana ETF

Several reasons are cited by Sigel for the elevated levels of memecoin trading and wash trading on Solana. First, SOL’s transaction fees are approximately 1/10,000th of Ethereum’s, reducing the opportunity cost of wash trading. Second, the architecture offers a superior user experience for memecoin trading due to its high throughput and low latency.

Third, platforms like Pump.fun simplify memecoin trading, encouraging higher activity levels. Fourth, the approach to MEV may inadvertently inflate trading volumes. “Solana’s MEV trading is driven by statistics-driven assessments of landing a transaction through submitting many orders for the same trade. Some of these likely land without capturing MEV, and this may juice trading figures higher than on Ethereum,” Sigel explained.

What Does That Mean For A Spot SOL ETF?

Sigel draws crucial comparisons between SOL and established companies like Alibaba, DraftKings, and CME Group to provide perspective on speculative trading activities. In Alibaba’s case, there was initial skepticism about package volumes that may have included ’empty packages’ to boost metrics prior to its 2014 IPO. DraftKings and CME Group derive substantial revenue from speculative trading, often providing incentives like reduced fees or rebates to stimulate activity.

By contrast, Solana does not incentivize users in the same manner. Its high activity levels are attributed to its low-cost, high-throughput design. “Solana’s on-chain activity is concentrated mainly in memecoins, making it a hub for speculative assets in the crypto world,” Sigel notes. However, he emphasizes that Solana has the potential to expand beyond speculation into impactful use cases such as decentralized physical infrastructure networks (DePIN) and social media applications.

While memecoins significantly contribute to the current revenue, its valuation—approximately 250 times forward revenue—reflects investor expectations for future growth in non-speculative applications.

Notably, the analysis has direct implications for VanEck’s proposed spot SOL ETF in the United States. The US Securities and Exchange Commission (SEC) has “identified possible sources of fraud and manipulation in the SOL market generally, including, among others, wash trading.”

Given that a substantial portion of revenues may be derived from suspicious trading activities, VanEck has included significant risk disclosures in its prospectus. “The analysis of Solana’s revenue sources is important because it brings to light concerns about our proposed SOL ETP,” Sigel states. “Since there is reason to believe a significant portion of SOL’s revenues are derived from suspicious trading, our ETF prospectus includes significant risk disclosures.”

However, Sigel also expressed optimism about SOL’s future: “We believe this high amount of activity derives from Solana’s high-quality user experience and will become a less important part of Solana’s revenue base as new activity comes to Solana. Ethereum’s transformation should be a guiding light for how Solana’s DEX volumes can mature over time to trading fewer meme-related assets.”

At press time, SOL traded at $161.

Solana price
Solana price needs to surpass the 0.618 Fib, 1-week chart | Source: SOLUSDT on TradingView.com
Featured image from Shutterstock, chart from TradingView.com
Editorial Process for bitcoinist is centered on delivering thoroughly researched, accurate, and unbiased content. We uphold strict sourcing standards, and each page undergoes diligent review by our team of top technology experts and seasoned editors. This process ensures the integrity, relevance, and value of our content for our readers.
ShareTweetShareShare

Sign Up for Our Newsletter!

For updates and exclusive offers enter your email.

I consent to my submitted data being collected and stored.
Jake Simmons

Jake Simmons

Follow

Jake Simmons has been a Bitcoin enthusiast since 2016. Ever since he heard about Bitcoin, he has been studying the topic every day and trying to share his knowledge with others. His goal is to contribute to Bitcoin's financial revolution, which will replace the fiat money system. Besides BTC and crypto, Jake studied Business Informatics at a university. After graduation in 2017, he has been working in the blockchain and crypto sector. You can follow Jake on Twitter at @realJakeSimmons.

Full Profile

Related Posts

Solana

Solana’s Q3 Revenue Sharp Growth Puts It Ahead Of All Major Crypto Networks

1 day ago
solana

Solana Corporate Playbook Expands With VisionSys AI’s $2 Billion SOL Treasury Plan

3 days ago
Bitcoin

Institutions Dump Massive Amounts Of Bitcoin And Ethereum As XRP And Solana Buying Ramps Up

3 days ago
Solana

Solana Ecosystem To Gain Boost With New Alliance Between Crypto.com And Sharps Technology – Details

4 days ago
bitcoin btc btcusd

Crypto ETFs Suffer Worst Streak Since Launch as Bitcoin and Ethereum Record Heavy Outflows

5 days ago
Solana news

Solana Could Get A Turbo Boost As Firedancer Targets Block Restrictions

5 days ago

Premium Sponsors

Press Releases

  • The Quiet Market Shift Investors Might Be Missing: How Tapzi Is Challenging Institutional Favorites

    The Quiet Market Shift Investors Might Be Missing: How...

    2 days ago
  • Investors Search for Long-Term Upside in This Under-$0.01 Crypto of 2025 Tapzi

    Investors Search for Long-Term Upside in This Under-$0.01...

    2 days ago
  • MoonBull Presale Explodes with over 11,800% Projected ROI as Uptober Sends the Market Soaring

    MoonBull Presale Explodes with over 11,800% Projected ROI...

    2 days ago
  • 狗狗幣引領『Uptober』Meme...

    2 days ago
  • ตัวละคร Snorter ขนฟูโต้คลื่นบนเซิร์ฟบอร์ดสีชมพู

    จับตา Uptober!...

    3 days ago

Bitcoin news portal providing breaking news, guides, price analysis about decentralized digital money & blockchain technology.

Bitcoin

  • News
  • Price
  • Businesses
  • Acceptance
  • Technology
  • Investment
  • Regulation
  • Reviews

Altcoins

  • News
  • Price
  • Ethereum
  • Ripple
  • Litecoin
  • EOS

Categories

  • Blockchain
  • Security
  • FinTech
  • Technology
  • Trending
  • Breaking News
  • Press Releases
  • How to

About Us

  • Advertise
  • Contact us
  • Editorial Policy
  • Privacy Policy
© 2025 Bitcoinist.com. All Rights Reserved.
  • Bitcoin
    • News
    • Price
    • Businesses
    • Acceptance
    • Technology
    • Investment
    • Regulation
    • Reviews
    • All Bitcoin News
  • Altcoins
    • News
    • Price
    • Ethereum
    • Ripple
    • Litecoin
    • EOS
    • NAGA
    • All Altcoin News
  • Tech
    • Blockchain
    • Security
    • FinTech
    • Price
      • Bitcoin Price
      • Ethereum Price
      • Binance Coin Price
      • Litecoin Price
  • Industry
    • Industry News
    • Press Releases
  • How to
    • Buy gift cards/mobile Top Ups with Cryptos
    • What Is Bitcoin?
    • Best Bitcoin Wallet
    • Bitcoin vs Ethereum
    • Why Use Blockchain Technology?
    • Bitcoin Cash ABC vs. Bitcoin Cash SV
    • How to Buy Cryptocurrency
    • How to do Crypto Gambling
      • Crypto Casinos
      • Crypto Betting
    • Play Crypto Games
      • Crypto Poker
      • Crypto Slots
      • Crypto Blackjack
      • Crypto Crash Gambling
      • Plinko
    • Bitcoin Mining
    • Best Bitcoin Brokers
    • Best Bitcoin Forex Brokers
    • How To Earn Bitcoin
    • What is Facebook Libra?
    • Ripple and XRP: The Complete Guide
  • Events
  • Play Games
Advertise

© 2025 Bitcoinist. All Rights Reserved.

This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy Center or Cookie Policy.