Solana’s Market Cap May Reach Half of Ethereum’s, Analyst Anticipates SOL Price Surge to $330
As per the data from VanEck’s MarketVector, Solana (SOL) was significantly undervalued in comparison to Ethereum (ETH), however, there could be a significant catch-up on the horizon.
Martin Leinweber, the director of digital assets research at MarketVector, predicted that SOL has the potential to achieve half of ETH’s market capitalization.
“Solana could potentially reach 50% of Ethereum’s market cap, with projections indicating SOL hitting a value of $330.”
SOL vs ETH
Leinweber suggested that owing to Solana’s superior performance across key metrics when compared to ETH, it might soon narrow the gap in their market caps.
For instance, Solana has demonstrated high scalability, faster transaction processing, and lower fees compared to ETH. A segment of the report mentioned,
“Solana handles 3,000% more transactions than Ethereum, boasts 1,300% higher daily active users, and records transaction fees that are nearly 5 million percent cheaper.”
Despite these impressive fundamentals, Leinweber observed that SOL continues to be significantly undervalued from a market cap perspective.
“Even with its superior performance across various key metrics, Solana’s market cap is only at 22% of Ethereum’s. Despite outperforming in transactions and user engagement, its market value remains notably behind.”
As per the data from CoinMarketCap, ETH’s market cap stood at $314 billion, whereas SOL’s was at $70 billion. If the size of ETH stagnates, SOL’s market cap would need to surpass $150 billion (more than 2x) to capture half of ETH’s market share.
The optimistic outlook for SOL’s price was also visible in the SOL/ETH ratio, which tracks SOL’s value in relation to ETH. The ratio surged from 0.01 in early 2024 to near its all-time high of 0.05, positioning itself close to reaching price discovery, potentially propelling SOL’s value to new peaks.
Nonetheless, Leinweber emphasized the necessity of more institutional participants to stimulate growth and enhance SOL’s value.
If approvals for SOL ETFs materialize, crypto trading and liquidity provider GSR shared a bullish sentiment back in July. Even though Brazil has sanctioned an SOL ETF, regulatory uncertainties persist in the US.
Despite these concerns, GSR anticipated that SOL could surge by 3.4x or even 8.9x in base and bullish scenarios, respectively, in the event that the US greenlights ETFs for the asset.
Presently, SOL’s price was in a consolidation phase around $150. The price had surged by almost 15% from its support level of $128 but needs to surpass the $160 mark to make further advances.