Standard Chartered Predicts Solana Will Lead the Crypto Market by 2025
According to a recent report from Standard Chartered, Solana is set to lead the cryptocurrency market by 2025, overtaking both Ethereum (ETH) and Bitcoin (BTC). The British bank forecasts that Solana's value could increase fivefold, especially if Donald Trump wins the upcoming U.S. presidential election.
Geoffrey Kendrick, Global Head of Digital Assets Research at Standard Chartered, introduced new valuation metrics for Layer-1 blockchains, with a focus on Solana and Ethereum. He compared Solana’s current market capitalization to Ethereum’s using several historical indicators. Currently, Solana's market cap-to-fees ratio is 250x compared to Ethereum's 121x.
This high valuation reflects market expectations of Solana’s future growth potential, which Kendrick believes could multiply by 100 to 400 times over the coming years. He asserts that this growth potential is more attainable under a Trump administration, given the former president’s favorable stance toward digital assets.
Report Highlights Token Supply and Staking Yields
While Ethereum has long been the dominant Layer-1 blockchain network, the increasing activity and rising price of Solana has sparked questions over whether the network could soon dethrone Ethereum. However, Standard Chartered’s report notes that SOL might currently be overvalued compared to Ethereum.
Additionally, Solana’s token supply is increasing at a rate of 5.5% annually, while Ethereum’s supply grows at only 0.5% per year. This directly impacts real staking yields, with Solana offering a 1% return and Ethereum providing 2.3%. Another factor in Ethereum’s favor is its developer community: 38% of blockchain developers work on Ethereum, compared to only 9% on Solana.
U.S. Election Impact on Crypto Regulation
The report also examines how U.S. regulatory policy could shift after the 2024 election. If Donald Trump wins, analysts predict a more favorable environment for the cryptocurrency market and increased chances of approval for Solana-based exchange-traded funds (ETFs).
Under this scenario, SOL could outperform ETH and BTC. However, if Kamala Harris were to lead the next administration, stricter regulations might be imposed, with Bitcoin likely remaining the dominant player, followed by Ethereum and Solana.
Despite these differing predictions, Standard Chartered remains optimistic about cryptocurrencies overall. The bank believes Ethereum could reach $7,000 by the end of 2025 if Harris is president, and up to $10,000 under a Trump administration. Bitcoin is expected to rise to $200,000 by the same time, regardless of the election outcome.
