10-Q: 21Shares Solana Staking ETF Reports Strong NAV Growth

The 21Shares Solana Staking ETF (TSOL) reported a substantial increase in Net Asset Value (NAV) for the quarter ended September 30, 2026, driven by Solana's price appreciation and significant share creations.

Summary

• The 21Shares Solana Staking ETF (TSOL) reported a significant increase in Net Asset Value (NAV) for the quarter ended September 30, 2026, rising by 243.69% to $9,786,070 from $2,847,364.
• This growth was primarily attributed to a 59.22% increase in the price of Solana, which rose from $73.61 to $117.20 during the quarter.
• The Trust also saw a substantial increase in outstanding shares, from 400,000 to 860,000, due to 460,000 shares being created.
• For the nine months ended September 30, 2026, the NAV increased by 70.64% to $9,786,070 from $5,735,019, despite a 5.46% decrease in Solana's price over the same period.
• The Trust maintained a high staking percentage, with 95.60% of its Solana holdings staked as of September 30, 2026.
• The Sponsor has voluntarily waived the Sponsor Fee for a one-year period starting July 28, 2026.

Sentiment

Score: 7

Explanation: StockSavvy.ai views this as a positive report, with significant NAV growth driven by Solana's price appreciation and share creations, despite a slight dip in Solana's price over the nine-month period. The fee waiver and strong staking performance contribute to a favorable outlook.

Positives

• Significant increase in Net Asset Value (NAV) of 243.69% for the quarter, reaching $9,786,070.
• Strong performance driven by a 59.22% increase in Solana's price during the quarter.
• Substantial increase in outstanding shares (from 400,000 to 860,000) due to share creations, indicating investor demand.
• High staking utilization rate, with 95.60% of Solana holdings staked as of September 30, 2026, contributing to staking rewards.
• Sponsor Fee waiver for one year (July 28, 2026, to July 27, 2027), reducing expenses.
• Net investment income of $59,167 for the quarter and $92,950 for the nine months, demonstrating revenue generation from staking.

Negatives

• A 5.46% decrease in Solana's price was observed over the nine-month period ended September 30, 2026.
• Net realized losses were incurred from selling Solana for cash redemptions ($232,315) and income distribution ($94,836) during the nine-month period.
• Net asset value per share decreased from $12.47 at the beginning of the nine-month period to $11.38 at the end.
• Total return for the nine months ended September 30, 2026, was negative at -3.90%.

Risks

• The Trust's investment strategy is concentrated solely in Solana, exposing it to significant market risks associated with this single digital asset.
• Temporary lock-up periods or transfer restrictions from staking could limit the Trust's ability to meet redemptions.
• The treatment of staking for U.S. federal income tax purposes is still developing, posing a risk of adverse regulatory or legal determinations that could affect the Trust's tax status.
• The value of the Trust's Shares is directly tied to the price of Solana, making it susceptible to volatility in the digital asset market.
• The Trust is not required to provide an auditor's attestation report on internal controls over financial reporting due to its emerging growth company status.

Future Outlook

The Trust aims to track the performance of Solana and reflect staking rewards. The Sponsor Fee waiver for one year is expected to positively impact net assets. The Trust's performance is highly dependent on the price movements of Solana and the effectiveness of its staking strategy.

Management Comments

• The Sponsor has agreed to voluntarily waive the Sponsor Fee for a period of one year beginning on July 28, 2026 and ending on July 27, 2027.
• The Trust intends to operate so that it will qualify to be treated for U.S. federal income tax purposes as a grantor trust.
• The Sponsor does not actively manage the Solana held by the Trust.
• The Trust's staking model aims to maximize the portion of the Trusts Solana available for staking while controlling for liquidity and redemption risks.

Industry Context

StockSavvy.ai notes that the performance of the 21Shares Solana Staking ETF is intrinsically linked to the volatility and price action of the Solana cryptocurrency. The increasing interest in staking rewards as a yield-generating mechanism within the digital asset space is a key trend, and this ETF aims to capitalize on that by offering exposure to Solana's staking yield.

Comparison to Industry Standards

• The Trust's NAV per Share of $11.38 as of September 30, 2026, is a key metric for comparison against other Solana-focused investment products.
• The Sponsor Fee of 0.21% (before waiver) is competitive within the digital asset ETF space, where fees can range from under 0.50% to over 2.00% for more specialized products.
• The Trust's strategy of staking a significant portion of its assets (95.60% as of September 30, 2026) aligns with industry practices for yield-generating crypto funds, aiming to capture staking rewards.
• The Trust's NAV growth of 243.69% in the quarter is exceptionally strong, outperforming many traditional ETFs and even some other digital asset funds during periods of significant crypto asset appreciation.

Legal Proceedings

• As of September 30, 2026, the Trust was not subject to any material legal proceedings, nor are any material legal proceedings threatened against the Trust.

Related Party Transactions

• The Sponsor, 21Shares US LLC, is a related party to the Trust.
• As of September 30, 2026, the Sponsor owned 20,000 Shares of the Trust.
• The Sponsor Fee is paid to the Sponsor for services performed under the Trust Agreement.
• The Staking Fee is paid to the Sponsor, representing 10% of the staking rewards generated by the Trust's Staking Activities after deduction of Staking Provider Consideration.

Stakeholder Impact

• Shareholders benefit from the potential for capital appreciation driven by Solana's price and income generated from staking rewards.
• The Sponsor Fee waiver for one year is a direct benefit to shareholders, as it reduces expenses and increases net asset value.
• Shareholders are exposed to the volatility and risks associated with Solana as the sole underlying asset.
• The Trust's tax treatment as a grantor trust means shareholders are treated as directly owning their pro rata share of the Trust's assets and income.

Next Steps

• Continue to track the performance of Solana and its associated staking rewards.
• Monitor the impact of the Sponsor Fee waiver on the Trust's net assets.
• Evaluate the ongoing effectiveness of the staking strategy in generating rewards while managing liquidity.
• Observe any developments in the regulatory treatment of staking for grantor trusts.

Key Dates

Recommendation

The ETF shows strong performance driven by Solana's price appreciation and staking rewards, with a beneficial fee waiver. However, the inherent concentration risk in a single volatile digital asset and the negative total return over the nine-month period suggest a 'hold' recommendation. Investors should be aware of the significant risks associated with Solana's price volatility.

Keywords

Solana Staking ETF, TSOL, Digital Asset ETF, Cryptocurrency ETF, Solana, Staking Rewards, Quarterly Report, NAV