Solana (SOL) Projection to Outpace Ethereum and Bitcoin by 2025
Solana (SOL) is making waves in the Cryptocurrency Market, with a report from Standard Chartered suggesting that it could lead the Growth by 2025, outpacing both Ethereum (ETH) and Bitcoin (BTC). The British multinational bank's report predicts a five-fold increase in Solana's value, particularly if Donald Trump secures victory in the upcoming US presidential election.
Geoffrey Kendrick, the Global Head of Digital Assets Research at Standard Chartered, introduced new valuation metrics for layer-1 blockchains, focusing on Solana and Ethereum. By comparing Solana's current market capitalization to Ethereum based on historical indicators, Kendrick highlighted Solana's significant market cap to fees ratio at 250x, while Ethereum stands at 121x.
This optimistic valuation for Solana is driven by expectations of its future Growth potential. Kendrick forecasts this potential to be between 100 to 400 times the current throughput of Solana in the coming years. He believes that achieving this growth is more feasible under a Trump administration, given the president's favorable stance towards digital assets.
Report Contrasts Token Supply and Staking Yields
Ethereum has long been the leading layer-1 Blockchain network, but the rising activity and token Price of Solana have sparked discussions about a potential shift in dominance. However, Standard Chartered's report suggests that SOL might be overvalued compared to Ethereum at present.
When analyzing token supply and Staking yields, the report highlights that Solana's token supply increases at a rate of 5.5% annually, while Ethereum's rate is 0.5%. This has a direct impact on real staking returns, where Solana offers a 1% yield compared to Ethereum's 2.3%. Additionally, Ethereum holds an advantage in developer support, with 38% of Blockchain developers working within its ecosystem compared to just 9% on Solana.
Impact of U.S. Election on Crypto Regulations
Standard Chartered's report also delves into the potential impact of the US election on Cryptocurrency regulations. A victory for former President Donald Trump could create a more favorable regulatory environment for the cryptocurrency market, potentially increasing the likelihood of approval for spot-based Solana Exchange traded funds (ETFs).
In this scenario, SOL could see enhanced performance compared to ETH and BTC. Conversely, if the new government is led by Kamala Harris, regulations may tighten, with Bitcoin expected to lead while Ethereum and Solana follow suit.
Despite varying election outcomes, Standard Chartered maintains an optimistic outlook on cryptocurrencies. The bank predicts that Ethereum could reach $7,000 by the end of 2025 under a Harris presidency and rise to $10,000 if Trump remains in power. Bitcoin is anticipated to Surge to $200,000 by the same year-end, regardless of election results.
