Solana ETP Inflows Exceed $500M as CME Futures Interest Peaks: Is a SOL Surge Imminent?

Key insights:

The open interest for Solana futures at CME has achieved an exceptional $2.16 billion, indicative of robust institutional engagement.
Retail participants are cautious, following $307 million in liquidations that have tempered leverage in the market.
Solana ETPs have topped $500 million in assets, highlighting a trend of institutional accumulation.

Solana’s futures have entered a crucial stage, with CME’s open interest hitting an unprecedented $2.16 billion as SOL’s price surged 23% to $235, following a local dip to $195 on Friday. This period coincided with a notable increase in institutional trading volumes at CME after SOL established its low point, suggesting that market players are strategically positioning in anticipation of the SEC’s decision on the SOL ETF scheduled for October 10.

SOL CME futures data. Source: Velo.data

Currently, the CME’s annualized basis sits at 16.37%, considerably below its 35% peak in July, indicating a hopeful yet not overly enthusiastic sentiment. In contrast, the retail-driven open interest on centralized exchanges has remained stable throughout the recent surge, while funding rates languish around neutral.

SOL price, aggregated open interest, and funding rate. Source: Velo.data

This contrast suggests that while institutions are making aggressive moves, retail investors are proceeding with caution, likely influenced by the $307 million in liquidations on September 22 that wiped out $250 million in long positions. There is a palpable reluctance among traders to chase momentum, keeping the market less susceptible to over-leveraged volatility.

Solana total liquidation chart. Source: CoinGlass

Structurally, this scenario presents a balanced but bullish outlook. Institutions are entering positions decisively, while the hesitance among retail investors prevents excessive market exuberance. The surge in CME trading at SOL’s recent local bottom indicates that stronger players are accumulating rather than indulging in speculative excess.

In addition, the inflow into Solana ETPs has further confirmed institutional interest. The total net inflows into Solana ETPs have now surpassed $500 million this week. This is primarily driven by the Solana Staking ETF (SSK) from REXShares, which exceeded $400 million, while the Bitwise Solana Staking ETP (BSOL) crossed over $100 million AUM. This indicates both the rapid expansion of BSOL and SSK since their inception, along with an increase in the acceptance of regulated avenues to gain Solana exposure.

Total SOL ETP net flows. Source: Hunter Horseley/X

Short-term SOL price scenarios: Rally or retreat?

The immediate trajectory for SOL is dependent on the potential return of confidence in retail investors. On the downside, a retreat towards $218 to $210 should not compromise the larger bullish framework, as it could test a fair value gap on the four-hour chart and revisit the 200-period exponential moving average.

SOL four-hour chart. Source: Cointelegraph/TradingView

The liquidation heatmap also indicates a dense liquidity cluster exceeding $200 million between $220 and $200, possibly acting as a price magnet. A pullback into this zone could create a healthy higher low, sustaining the bullish market structure while clearing out latecomers.

Solana liquidation heat map. Source: CoinGlass

Conversely, a solid movement above $245 to $250 would demonstrate market strength, which could propel SOL towards its all-time high near $290. Given the trend of institutional flows, this scenario strengthens if ETF speculation continues to dominate the narrative.

In both scenarios, the absence of aggressive retail leverage is beneficial for SOL, diminishing downside risk from potential liquidations. The ongoing growth in CME open interest, driven by institutions, suggests that any corrections are likely to be mild rather than trend-altering.

Presently, SOL futures depict a market shifting from fear to cautious accumulation, with institutions at the forefront of these movements.

This article does not offer investment guidance or recommendations. Every investment and trading action carries risk; readers should perform their own due diligence prior to making any decisions.