Cryptocurrency market maker GlaxoSmithKline released a research report on Thursday highlighting the potential opportunity for the approval of a spot Solana ETF in the United States, especially with Donald Trump set to take office as president again.
The report suggests that Solana (SOL) could be the next company to receive approval for an ETF after Bitcoin and Ethereum, potentially leading to a substantial increase in cryptocurrency prices.
The report compares the price trends of Bitcoin after the approval of its spot ETF and outlines three potential scenarios for the price increase of Solana: a bearish estimate of 1.4 times, a base scenario of 3.4 times, or an optimistic estimate of 8.9 times representing inflows.
The report states: “If the United States allows additional spot digital asset ETFs, Solana is ready to launch a spot ETF, which could have the largest impact on the price to date.”
GSR, which holds long positions in Solana, emphasizes the significant shift in the political climate surrounding cryptocurrency in recent months. The rapidly approaching election between the current Democratic president, Joe Biden, and his Republican challenger, former president Donald Trump, has quickly developed into a potential wedge issue for cryptocurrency.
The report specifically notes, “Donald Trump’s new support for the cryptocurrency industry has, in turn, led Democrats to relax their stance on digital assets in a tense election year.”
This shift has led to bipartisan support for cryptocurrency-friendly legislation, including the repeal of the SEC’s SAB 121 accounting policy and the passage of the FIT21 Digital Asset Regulatory Framework by the House of Representatives.
GSR’s analysis introduces an “ETF potential score” based on two key factors: decentralization and potential demand. Solana has achieved positive scores in both indicators, with the company seeing these scores as second only to Ethereum.
The report concludes: “If the United States allows additional spot digital asset ETFs, Solana will be next.”
On Thursday, asset management company VanEck submitted an S-1 registration statement to the U.S. Securities and Exchange Commission (SEC) to purchase Solana ETF.
This marks an important step as it is Solana’s first spot ETF registration in the United States, just six days after a similar product was launched in Canada. The application immediately affected the price of Solana, which rose nearly 10% that day.
SOL beats BTC?
The analysis also frequently compares Solana’s prospects with Bitcoin’s recent experience of spot ETF approval in the United States.
Notably, the price of Bitcoin increased 2.3 times from $27,000 in October 2023 (about three months from the approval of the U.S. Securities and Exchange Commission) to about $63,000 this month, mainly attributed to ETF-related developments by GSR.
However, the report suggests that, given Solana’s greater practicality in its widespread applications and use cases, its potential advantage may be more significant.
GSR writes: “Unlike BTC, SOL is actively used for staking and decentralized applications, so the relationship between relative flow and relative scale may not be linear.”