Solana June 2025 Update

SOL Staking ETF

The REX-Osprey SOL Staking ETF launched on July 2, 2025, becoming the first US ETF to offer exposure to SOL and staking rewards. Rex-Osprey's approach is different from other proposals and sidestepped the traditional approval process with a legal workaround. Unlike traditional crypto trusts, this ETF is structured under the Investment Company Act of 1940 using a C-corporation format. As such, staking distributions to investors will be taxed inside the fund before being distributed as dividends. The management fee for the ETF will be 0.75%, with an additional current/deferred income tax expense of 0.53% raising the total cost to 1.28%.

While the launch reflects a much more favorable regulatory regime, we remain relatively bearish on potential inflows. First, note that the SOLZ futures ETF has been live for three months and has only $22M in AUM. For context, ProShares’ EETH futures ETF had $116M in AUM before the spot ETFs went live on July 23, 2024. Second, while the REX-Osprey fund structure is more favorable, we think the real test on institutional demand will come when the SOL spot ETFs are approved under the 33 Act and issuers like Blackrock and Fidelity enter the market, though there is no timeline for these launches as of writing.

On a related note, the Jito Foundation announced a partnership with Anchorage Digital, home to the only federally-chartered crypto bank in the US, to enable support for JitoSOL mints and burns. Staking-enabled ETFs need in-kind creation/redemption, deep liquidity, and bank-grade custody. Anchorage’s native mint-and-redeem flow gives JitoSOL all three, positioning it well for future ETF products. 

Network Health

ZK ElGamal Proof Program Bug

On June 25, Solana disclosed a second vulnerability in the ZK ElGamal Proof program, the component that verifies confidential-transfer proofs for the Token-2022 standard. Reported privately on June 10, the flaw stemmed from an element that was omitted from the Fiat-Shamir transcript hash, allowing a skilled attacker to forge proofs and mint or drain confidential tokens. Engineers issued an emergency upgrade on June 11 that disabled confidential transfers, and a week later, fully deactivated the ZK ElGamal program.