Bitwise CEO Hunter Horsley believes that Solana may gain an advantage over Ethereum in the staking ETF market — all due to a more investor-friendly mechanism.
In an interview at the Token2049 conference in Singapore, Horsley explained that Solana has a faster unstaking process, giving it an edge. For example, the withdrawal queue on the Ethereum network recently hit a new high, while on Solana such delays are usually resolved more quickly. According to Horsley, this is critical for issuers — they must be able to quickly return assets to investors.
“This is a huge problem. ETFs are required to provide redemptions in a short time frame. And that’s where the difficulties begin,” he said.
Staking is the process of locking up cryptocurrency in a network for rewards. But because of this, funds are not immediately available, and withdrawal times can vary depending on network load.
According to Horsley, products on Ethereum do have ways to work around the long withdrawal issue, but all of them are compromises. For example, the staking ETP from Bitwise, which is traded in Europe, uses a special credit line to quickly return funds to investors.
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This approach helps maintain liquidity, but as Horsley noted, it’s not free — such schemes require costs and operate within a limited cap.
An alternative path is liquid staking tokens like stETH from Lido. They are a kind of substitute for locked assets that can be used like regular crypto while the original funds continue to earn yield. It’s a convenient but not universal solution: such tokens carry additional risks and depend on trust in the issuing platform.
All these discussions come as, at the beginning of September, the queue to enter Ethereum staking reached nearly 860 thousand ETH — the highest in the past two years. Pressure on the network is growing, and it seems the situation won’t change soon.
Currently, the staking queue is about 201,984 ETH, and the average waiting time is three days. According to on-chain analytics, the withdrawal queue has stretched to about 34 days, with more than 2 million tokens waiting for withdrawal.
Deadlines for SOL and ETH ETFs Come in October
The US Securities and Exchange Commission (SEC) is expected to make decisions in the coming weeks on several applications to launch ETFs based on Solana and Ethereum — including those with staking support.
Applicants include Bitwise, Fidelity, Franklin Templeton, CoinShares, Grayscale Investments, Canary Capital and VanEck. All of them have submitted updated S-1 forms to the SEC, reflecting new staking provisions in their funds.
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In August, the regulator already postponed decisions on two staking ETFs from Grayscale — the deadline was moved to the end of October. The staking option in the application from BlackRock (iShares Ethereum Trust) was also postponed until October 30.
This month, the SEC is to review 16 crypto-oriented funds. But due to the federal government shutdown, agencies are operating in a limited mode, so decisions on ETFs are likely on pause.
