Bitwise Solana ETF approved for loans at 25% LTV

A major bank now lets customers borrow up to 25% of their Bitwise Solana Staking ETF holdings, adding a lending function to the U.S.-listed crypto fund.

Bitwise's Solana staking ETF won bank approval for loans up to 25% of shares' value, adding a lending function to the U.S.-listed crypto fund. Bitwise co-founder and CEO Hunter Horsley disclosed the approval in an Aug. 11 post on X, saying the unnamed bank would let customers borrow against BSOL shares under a maximum 25% loan-to-value ratio.

Under the limit, a customer pledging $100,000 of BSOL could borrow no more than $25,000, with the ETF shares serving as collateral while remaining exposed to Solana's price. Horsley did not identify the lender, the interest rate, minimum loan size, or repayment terms.

The approval adds BSOL to the securities at least one lender accepts for collateralized borrowing, deepening crypto's integration with established financial services. It does not mean the SEC or another federal regulator approved BSOL specifically for loans.

BSOL loans capped at 25% of collateral value

A 25% LTV leaves the bank with $75 in collateral value above every $25 lent at the start of the transaction. The lender's unpublished agreement would determine what happens if BSOL falls, including whether the customer must add collateral, repay part of the balance, or face a sale of pledged shares.

The loan is secured by exchange-traded shares rather than SOL held in a private wallet. BSOL shareholders do not control the underlying tokens or their private keys, while the bank can value the listed shares using their market price and apply its existing securities-backed lending procedures.

Unlike a sale, borrowing against shares lets an approved customer obtain cash without immediately disposing of the position. According to the Internal Revenue Service, loan proceeds generally do not count as income because borrowers must repay them, although a later sale of collateral may create a taxable transaction.

BSOL combines SOL exposure with staking

Launched on NYSE Arca in October 2025, BSOL gives U.S. investors direct exposure to SOL through a publicly traded product. Bitwise stakes nearly all of the fund's tokens so that staking rewards increase the assets supporting its shares. The fund recorded $69.45 million in net inflows on its first trading day, with a 0.20% management fee.

Bitwise's official fund data showed BSOL held 8,184,971.62 SOL with a market value of $622.02 million as of Aug. 9. Each share represented about 0.136735 SOL. BSOL reported a net asset value of $10.39 per share and a market price of $10.41 on the same date.

Staking covered 99% of the fund's SOL holdings, compared with Bitwise's target of 100%. The gross annualized staking reward rate averaged 6.21% over the preceding 90 days, while the net rate after staking-related fees stood at 5.84%. The fund uses Coinbase Custody Trust Company to hold its SOL, according to its SEC filing, while Bitwise Onchain Solutions, supported by Helius technology, handles staking and BNY Mellon provides cash custody.

BSOL drew capital despite Solana's first-half decline

BSOL drew $267.1 million in net subscriptions during the first half of 2026, according to its Aug. 7 filing with the U.S. Securities and Exchange Commission. Share issuance lifted the fund's SOL holdings from about 5.15 million tokens at the end of 2025 to approximately 8.05 million by June 30.

Falling SOL prices still reduced BSOL's net assets from $641.3 million to $592.3 million over the six-month period. Its net asset value per share dropped from $16.37 to $10.01, producing a negative 38.85% NAV return for the half-year. The filing recorded $19.2 million in gross staking rewards and approximately $17.7 million in net investment income after expenses. Portfolio losses reached about $333.8 million, including $262.9 million in unrealized depreciation and $70.9 million in realized losses.

BSOL controlled roughly 81% of assets accumulated by U.S. spot Solana funds by mid-May, with combined assets across products issued by Bitwise, Fidelity, and Grayscale reaching approximately $1.06 billion. BSOL had already crossed $500 million in assets within its first 18 trading days.

For American investors, the bank's approval gives BSOL a function once reserved for blue-chip equities: use as collateral for borrowing. The 25% LTV is conservative by traditional finance standards — blue-chip equities typically qualify for 50-70% LTV at major brokerages — reflecting the volatility of the underlying token. As more banks accept crypto ETFs as collateral, the regulated wrapper, auditable holdings, and daily liquidity make BSOL a bridge between digital assets and conventional lending.

This article is for informational purposes only and does not constitute investment advice.