Cryptocurrency market maker GSR Markets has suggested that a US spot Solana exchange-traded fund (ETF) could cause the price of SOL to increase ninefold.
In a report on June 27, the company described Solana as part of the “cryptocurrency big three” and examined whether Solana could become the next spot cryptocurrency ETF to be approved by US regulators.
Coincidentally, GCR’s report was released on the same day that VanEck applied to issue a spot Solana ETF, which surprised many.
GSR’s estimated long position in SOL has reached a “best case” scenario of 8.9 times, with the assumption that, based on the relative market cap size of the Bitcoin spot ETF, the spot Solana ETF would absorb 14% of the flows since the launch of the spot Bitcoin ETF in January.
GSR’s “best case” would see Solana’s current price rise from $149 to over $1,320, and Solana’s market cap would increase to $6.14 trillion (at the current supply).
Meanwhile, GSR’s “bearish” and “benchmark” scenarios would see the spot Solana ETF account for 2% and 5% of Bitcoin, causing Solana’s price to increase 1.4 times and 3.4 times, respectively.
The company stated that if the spot Solana ETF includes staking rewards income, these estimates could be even higher—despite approved spot Ether ETFs not allowing staking.
“If the US allows additional spot digital asset ETFs, Solana is ready to launch a spot ETF, which could have the largest impact on prices to date,” GSR said.
While GSR is optimistic, Bloomberg ETF analyst Eric Balchunas and others believe that serious consideration of a spot Solana ETF is necessary given the changes in the US presidency and the chairman of the Securities and Exchange Commission.
The US Securities and Exchange Commission and its chairman, Gary Gensler, have marked the SOL token as a security in lawsuits against Binance and Coinbase, making the road to approval much more difficult than for the spot Bitcoin and Ethereum ETFs.
A week before VanEck filed its application, cryptocurrency asset management company 3iQ applied for a spot Solana ETF in Canada, marking the first time in North America.
The recent price performance and major developments of Solana. Source: GSR
Solana’s ecosystem and network have also received praise from the $1.5 trillion asset management company Franklin Templeton, but the company has not confirmed plans to launch a spot Solana ETF in the future.
Spot Solana exchange-traded products worth over $1 billion have been offered globally.