Spot Solana exchange-traded funds recorded their first net outflow of $8.10 million on November 26, breaking a 21-consecutive-day inflow streak that began when the products launched in late October.
The outflow occurred despite cumulative inflows reaching $613.22 million and total net assets climbing to $917.99 million across six funds, according to SoSoValue data.
The reversal came as institutional capital rotated toward Ethereum and XRP products, with Ethereum ETFs drawing $60.82 million and XRP funds attracting $21.81 million on the same day. Bitcoin ETFs recorded modest inflows of $21.12 million, suggesting selective positioning among investors rather than broad risk-off sentiment. The Solana outflow was driven primarily by 21Shares' TSOL fund, which posted a $34.37 million withdrawal, while Bitwise and Grayscale products continued to attract fresh capital.
The development comes as Franklin Templeton filed its final Form 8-A regulatory paperwork with the Securities and Exchange Commission for a spot Solana ETF featuring a 0.19% management fee and a fee waiver on the first $5 billion in assets until May 31, 2026.
The filing positions Franklin Templeton to launch its SOEZ product on NYSE Arca as early as November 27, adding to a competitive landscape that has seen stronger-than-expected institutional demand since Bitwise debuted the first U.S. Solana ETF on October 28.
What Happened
Solana ETFs posted their first negative daily flow since inception, with the $8.10 million outflow representing a sharp reversal from recent momentum that saw the funds attract between $8.26 million and $58 million per day throughout November. The 21-day inflow streak had pushed total assets to $917.99 million, equivalent to approximately 1.09% of Solana's market capitalization.
21Shares' TSOL product accounted for the bulk of redemptions, posting a $34.37 million outflow that brought its cumulative net flows into negative territory at -$26.22 million. The fund's price still gained 3.92% on the day, demonstrating that outflows did not prevent the underlying asset from appreciating as Solana traded near $141, up 3.8% for the session.
Bitwise's BSOL ETF led inflows with $13.33 million, adding 93,170 SOL tokens and bringing its cumulative inflows to $527.79 million with net assets totaling $631.20 million. Grayscale's GSOL fund attracted $10.42 million and added 72,840 SOL, with net assets reaching $148.28 million. Fidelity's FSOL added $2.51 million for the day, increasing cumulative inflows to $29.89 million, while VanEck and Canary products recorded no flows.
The broader crypto ETF market showed divergent patterns. Ethereum spot ETFs recorded their fourth consecutive day of inflows with $60.82 million entering the funds, marking a reversal from weeks of outflows that began November 11. Bitcoin ETFs attracted $21.12 million despite Fidelity's FBTC posting a $33.3 million outflow, with BlackRock's IBIT drawing $42.8 million to lead the positive flows.
XRP ETFs continued their unbroken positive streak with $21.81 million in inflows, bringing cumulative flows to $643 million since launching on November 13. The products have not recorded a single day of outflows since debut, reflecting sustained institutional interest following regulatory clarity after Ripple's legal battle with the SEC concluded.
Franklin Templeton's Solana ETF filing marks the asset manager's entry into the Solana market after the successful launch of its XRP ETF, which attracted $62.6 million on its first full trading day. The firm filed Form 8-A on November 25, representing the final administrative step before trading can commence. The SOEZ ETF will track the CF Benchmarks Solana Index and hold physical SOL tokens in custody, offering a passive investment vehicle with the lowest management fee in the sector.
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Why It Matters
The first Solana ETF outflow tests the durability of institutional demand for the third-largest cryptocurrency by market capitalization amid broader market volatility. Solana declined 30% over the past month, trading between $125 and $143 as negative perpetual funding rates and declining trading volumes pressured the asset. The single-day outflow does not necessarily signal a trend reversal, but it highlights that institutional appetite for Solana exposure remains selective even as cumulative flows approach a major milestone near $1 billion in assets.
The rotation toward Ethereum and XRP products suggests investors are reallocating capital toward assets with clearer regulatory paths and established institutional adoption. Ethereum's four-day inflow streak totaling more than $220 million followed weeks of heavy redemptions that saw $1.64 billion leave the funds between November 3 and November 24. The reversal indicates renewed confidence in Ethereum's scaling roadmap and upcoming network upgrades, including the December 3 Fusaka hard fork.
Franklin Templeton's aggressive fee strategy undercuts all competing Solana ETF products and mirrors tactics used during the Bitcoin ETF launches, where fee competition drove rapid asset accumulation. The firm's fee waiver on the first $5 billion until May 2026 could accelerate early adoption and pressure existing issuers to lower their own fee structures. With $1.66 trillion in total assets under management, Franklin Templeton brings institutional credibility that may attract allocators who have remained on the sidelines.
The timing coincides with SEC guidance allowing automatic effectiveness under Section 8(a) for registration statements filed without delay clauses. The mechanism enables ETF launches after a standard 20-day period unless the SEC intervenes, accelerating the approval process that had been backlogged during the October government shutdown. Bloomberg ETF analyst Eric Balchunas noted that issuers leveraging this pathway could bring products to market rapidly, with multiple crypto ETFs expected to launch in December.
JP Morgan originally forecast Solana ETFs would attract $3-6 billion in their first 6-12 months but revised projections to approximately $1.5 billion in the first year following the October market downturn. The funds have already surpassed 60% of the revised forecast within their first month, suggesting institutional demand remains robust despite price volatility. Solana's ecosystem growth - including tokenization projects like xStocks bringing U.S. equities on-chain and expanding DeFi activity - continues to attract traditional finance interest.
Final Thoughts
The Solana ETF market's first outflow day represents a natural consolidation after three weeks of uninterrupted inflows rather than a fundamental shift in institutional sentiment. The $8.10 million redemption is modest relative to the $613 million in cumulative flows and may reflect short-term profit-taking or rebalancing following SOL's 30% monthly decline. More significant is the pattern of selective capital allocation across crypto ETFs, with Ethereum and XRP products capturing the majority of fresh investment as Bitcoin flows remain tepid.
Franklin Templeton's imminent market entry adds competitive pressure that could benefit investors through lower fees and expanded product choice. The firm's success with its XRP ETF, which attracted nearly $70 million in its first two trading days, demonstrates that established asset managers can rapidly capture market share in the altcoin ETF space. If Franklin Templeton's Solana product replicates this performance, total Solana ETF assets could exceed $1 billion by early December.
The divergence between Solana ETF flows and the underlying token's price performance highlights that institutional products do not guarantee immediate price appreciation. SOL has traded in a consolidation range between $125 and $145 despite consistent ETF inflows, suggesting that demand from retail traders and on-chain activity remains the primary driver of short-term price action. Analysts have identified key resistance at $145, with a breakout potentially targeting the $155-175 zone if broader market conditions improve.
The sustainability of Solana ETF demand will depend on several factors: the network's ability to maintain high throughput without outages, continued growth in DeFi and real-world asset tokenization applications, regulatory developments affecting proof-of-stake networks, and competition from other layer-1 blockchains. Recent network congestion concerns following the Upbit security incident in late November may have contributed to selective institutional caution, though the impact appears limited given that only one fund recorded significant outflows.
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