The SEC’s approval of a spot Solana Exchange-Traded Fund (ETF) is expected to drive the price of Solana (SOL) to $1300, according to analysts.
While Bitcoin (BTC) and Ethereum (ETH) are currently the only cryptocurrencies that meet the basic requirements for a spot ETF, the potential for approval could change under a pro-crypto administration, as per a GSR report.
The recent filing for a spot Solana ETF by VanEck and 3iQ on the Toronto Stock Exchange has sparked interest and positioned the price for a potential rally. To analyze the possibilities of approval and its impact on the SOL price, GSR released a comprehensive report titled “Is Solana Next?”
The report praises the evolution of the Solana network, highlighting its nearly 300 billion transactions, over $4 billion in Total Value Locked (TVL), and its large number of decentralized applications as contributing factors to its potential success.
The GSR report also outlines the key features that qualify an asset for an ETF, emphasizing the need for a federally-regulated futures market and a futures-based ETF. Currently, only Bitcoin and Ethereum meet these criteria, indicating that other ETFs may not be approved in the near future unless there is a shift in the political landscape.
In terms of decentralization and potential demand, Ethereum, Solana, and NEAR are the only crypto projects with above-average scores, according to the report. However, most of the assets in the list, including ADA, SOL, NEAR, ATOM, and XRP, have been flagged by the SEC as securities.
The report presents three potential scenarios for the impact of a spot Solana ETF on the SOL price. Under the bear case, the price of SOL is expected to surge by 1.4x, while under the baseline scenario, the price is projected to surge by 3.4x. The blue-sky scenario envisions a surge of 8.9x, potentially driving the SOL price to $1305.
As of now, SOL is trading at $144, having declined by 2.9% in the last 24 hours.