Two new ETF proposals have entered the spotlight this week, bringing the U.S. Securities and Exchange Commission (SEC) one step closer to potentially approving a broader range of cryptocurrency investment products. A proposed Solana exchange-traded fund (ETF) by Invesco Galaxy and an unusual fund linked to Pudgy Penguins tokens by Canary Capital are the latest additions to the SEC’s growing crypto-related to-do list.

These filings arrive amid a growing wave of altcoin ETF applications, driven by the success of spot Bitcoin and Ethereum ETFs and a shift toward a more crypto-receptive regulatory climate.

Invesco and Galaxy Target Solana Exposure

The Invesco Galaxy Solana ETF, if approved, would provide direct exposure to Solana (SOL), the sixth-largest cryptocurrency by market capitalization. According to the filing, the fund would trade under the ticker QSOL, tracking Solana’s spot market performance. Galaxy Digital Funds will act as the execution agent, responsible for buying and selling SOL, while Coinbase will serve as the fund’s custodian.

This marks the ninth Solana ETF application, with other major asset managers like Fidelity, VanEck, Bitwise, and Grayscale also submitting similar filings.

Earlier this month, many of these firms updated their S-1 forms to include provisions for staking — a process that allows ETFs to earn yield on held tokens. The inclusion of staking in ETFs has become a point of contention, with U.S. regulators yet to offer clear guidance on its treatment under federal securities law.

Pudgy Penguins Join the ETF Lineup

In a more unconventional move, Canary Capital has proposed an ETF tied to Pudgy Penguins, a well-known NFT project. The Canary PENGU ETF, according to the 19b-4 filing submitted by the Cboe BZX Exchange, would hold both PENGU tokens — a Solana-based altcoin — and select NFTs from the Pudgy Penguins collection.

This would make the PENGU fund one of the first ETFs to blend token and NFT exposure into a single regulated product. The filing is part of Canary’s broader push into altcoin-based ETFs, showing that the appetite for diverse crypto exposure continues to grow.

SEC Faces Pressure as Altcoin ETF Wave Builds

The SEC is now reviewing over two dozen altcoin ETF proposals, including funds tied to XRP, Dogecoin, Cardano, Polkadot, and Hedera. Following the success of spot Bitcoin and Ethereum ETFs, which collectively pulled in over $51 billion in net investments, many believe the door is now open for more crypto products to receive regulatory approval.

Notably, Bloomberg ETF analysts Eric Balchunas and James Seyffart estimate that Solana, XRP, and Litecoin ETFs have a 95% chance of approval by the end of 2025. Other altcoin funds, such as those focused on Dogecoin and Cardano, are projected to have a 90% likelihood of approval.

If the analysts’ predictions are accurate, these approvals could start arriving in Q4 of 2025, adding fresh momentum to the digital asset investment space.

Why Staking Is a Regulatory Flashpoint

While ETF filings for Bitcoin and Ethereum succeeded largely because of the clarity around these assets, the question of staking continues to be a sticking point for regulators.

Staking involves locking up tokens in exchange for rewards, a process some regulators view as potentially equivalent to earning interest — thereby raising concerns around securities classification. The SEC previously delayed Ethereum ETF decisions due to the inclusion of staking mechanisms, and it remains unclear whether Solana and other altcoin ETF issuers will need to make further changes to gain approval.

Nevertheless, applicants are proactively addressing these concerns. The recent amendments to staking language in the S-1 forms suggest that issuers are eager to comply with SEC feedback and avoid further delays.

Solana Price Holds Despite ETF Uncertainty

Despite these promising developments, Solana’s price remains under pressure. At the time of writing, SOL is trading at $143, marking an 18% decline over the past month. Most altcoins have followed similar trends amid broader market uncertainty and profit-taking.

Still, many analysts view this downturn as temporary. The potential approval of multiple Solana ETFs is widely expected to serve as a significant price catalyst.

In a recent comment, trader Cipher X noted:

“Solana ETF approval chances are 80% by July. If that happens, we could see a monthly move of 40% to 50%.”

Investor sentiment remains cautiously optimistic, with growing institutional interest — including record Solana activity on the CME derivatives market — reinforcing the narrative that SOL remains a top-tier blockchain asset.

Outlook: What Comes Next?

As the SEC continues to evaluate filings, the crypto investment community will be watching closely. Both the Solana and Pudgy Penguins ETF proposals highlight the evolving nature of digital asset investment vehicles, as traditional financial firms look to meet rising demand for diversified crypto exposure.

Should the SEC give the green light to any of these altcoin ETFs, it would mark a major step forward for mainstream crypto adoption — one that goes far beyond Bitcoin and Ethereum.

Whether staking will be permitted in final approvals remains a key question. But with billions already flowing into crypto ETFs and more asset managers entering the race, the crypto ETF market is poised for its next evolution.