- VanEck projects the smart contract platform market to grow 43% to US$1.1 trillion by 2025, driven by their correlation analysis with US M2 money supply growth.
- Based on Solana’s 15% market share in the smart contract space, VanEck estimates SOL could reach US$520 with a market cap of US$250 billion, up significantly from its current US$198 price point.
- The SEC has notably acknowledged a Spot Solana ETF filing, marking the first time they’ve done so for an asset previously labelled as a security, though approval remains uncertain.
After XRP has significantly drawn the altcoin market’s attention, it could be time for Solana (SOL) to finally shine.
Investment firm VanEck predicts that the price per SOL could skyrocket to US$520 (AU$832) before 2026, on the back of growing smart contract demand and expectations for an increase in money supply.
Our SCP market cap forecast is derived from U.S. M2 money supply growth, given its strong historical correlation with crypto market capitalization.
VanEckVanEck Expects Smart Contracts on Solana To Soar
The M2 money supply comprises cash, checking deposits and other forms of near money that are readily convertible; it monitors the circulation of money within the US economy. VanEck expects this to reach US$22.3 trillion (AU$35.6 trillion) by the end of 2025.
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Based on this, they believe the market for smart contract platforms (SCP) to also grow by 43% to US$1.1 trillion (AU$1.75 trillion), based on M2’s “strong historical correlation with crypto market capitalization”.
We project M2 to reach $22.3T by the end of 2025, maintaining its 3.2% annualized growth rate since its last trough in October 2023. Using regression analysis, we estimate total SCP market capitalization will grow 43% to $1.1T by year-end 2025 (vs. $770B today), surpassing its 2021 peak of $989B.
VanEckAs Solana captures a sizeable chunk of the SCP market cap – 15% according to VanEck – this too should rise, resulting in a US$250 billion (AU$400 billion) market cap and price of US$520 (AU$831.25) per SOL.
At the time of writing, the coin trades hands for US$197.98 (AU$316.48) and has a market cap of US$96.5 billion (AU$154.26), making it the fifth-largest crypto.
SEC Makes ‘Newsworthy’ Acknowledgement
Meanwhile, there’s movement on the crypto exchange-traded fund (ETF) front. The US Securities and Exchange Commission (SEC) has recently “acknowledged” a filing for a Spot Solana ETF, something that’s worth mentioning because, according to Bloomberg ETF analyst James Seyffart, “the SEC had refused to do this in recent filing attempts for SOL”.
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Fellow Senior Bloomberg ETF analyst, Eric Balchunas, added that it’s the first time the SEC has done this for something that’s been named a security in the past.
Although it doesn’t mean approval is imminent, the analysts believe it’s a small step in the right direction. SOL hasn’t really reacted to the news and is down 0.2% in the past 24 hours.
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