With Bitcoin and Ethereum ETF now a done deal, industry stakeholders are seeking to know if Solana is next on the approval list. This is one of the questions buzzing around in some quarters of the cryptocurrency ecosystem. Assuming the coin receives ETF approval in the US, GSR predicts that the price of Solana could soar from $145 to $1,289.
Judging Solana Outlook from Bitcoins Perspective
Noticeably, in the broader cryptocurrency ecosystem, Bitcoin and Ethereum are the top two digital assets by market capitalization. Tether, BNB, and Solana make up the top five list. As per GSR analysis, using inference from Bitcoin performance after applying for an ETF, Solana stands to witness significant gains.
In October 2023, Bitcoin was less than $30,000; specifically, it traded at $27,000. However, with conversations around the possibility of an approval and subsequent nod by the U.S. Securities and Exchange Commission (SEC), there was a 2.3x increase to approximately $63,000.
GSR predicts that should Solana go the ETF pathway, the expected inflows to an ETF might mirror those of BItcoin. Relying on three key scenarios of Bear case, Base case, and Blue sky case, the relative inflow to Bitcoin were 2%, 5%, and 14% respectively.
Given that Solana has a smaller market price compared to Bitcoin, GSR adjusted for this factor and used an average of 4% over the past year. Based on these, Solana could see a price increase of 1.4x in the bear case, 3.4x in the base case, and 8.9x in the blue sky case in the coming years.
Solana’s Potential on GSR’s Projections
Interestingly, the impact might be even greater than the projections by GSR considering Solana’s active use in staking and decentralized applications. This suggests a non-linear relationship between relative flows and size.
Additionally, there’s likely less speculation baked into SOL’s price regarding a potential spot ETF compared to Bitcoin, as inferred from Grayscale Trust deviations. This implies Solana’s upside with a spot ETF could be viewed as a “free option.”
As per CoinMarketCap data, Solana is trading at $144.95, up 4.66% in 24 hours. As such, if a blue sky case plays out, the price could hit $1,159.
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