Crypto News – Solana Joins Crypto’s Elite Trio, Says GSR

Crypto News – GSR Declares Solana as One of Crypto’s Top Three

Crypto News- Rumors about the next big crypto exchange-traded fund (ETF) being based on Solana gained traction as asset manager VanEck submitted an application to launch a spot Solana ETF on Thursday. VanEck’s head of digital assets, Matthew Sigel, emphasized on X that Solana (SOL) should be recognized as a commodity due to its decentralized nature, high utility, and economic feasibility.

SEC’s Role and Market Dynamics

The U.S. Securities and Exchange Commission’s (SEC) approval of spot bitcoin and ether ETFs followed the trading of futures products for both assets for several years. However, there is currently no futures ETF based on Solana. Bloomberg’s senior ETF analyst Eric Balchunas suggested that a leadership change at the SEC or within the U.S. government could shift the outlook in favor of the Solana ETF’s approval. Crypto lawyer Jake Chervinsky pointed out that there are no regulatory barriers preventing the SEC from approving a crypto ETF without an existing futures market.

GSR’s Analysis on Solana’s Prospects

In a June 27 report, crypto trading firm GSR analyzed the likelihood of additional crypto ETFs, focusing specifically on Solana. GSR analysts stated, “Solana has cemented itself as part of crypto’s Big Three. And with the others having or on the cusp of a spot ETF, it’s likely just a matter of time before Solana gets one too. The impact on SOL could be significant.”

Decentralization and Demand Scores

GSR evaluated Solana’s decentralization with a score of 0.4, ranking it as the second most decentralized asset after Ethereum (ETH), which scored 0.5. This assessment was based on factors such as validator distribution, governance, and minimum validator requirements. In terms of demand, which considered market indicators, assets under management for existing products, and network activity metrics, Solana scored 0.7, while Ethereum scored 1.5.

Final ETF Possibility Score

Combining decentralization and demand scores, GSR arrived at a final ETF possibility score of 0.58 for Solana and 1.13 for Ethereum. Native tokens of other blockchains like NEAR and AVAX received negative scores in GSR’s analysis.

Potential Impact on Solana’s Value

GSR analysts projected that Solana might increase 1.4 times under a bear scenario, 3.4 times under a baseline scenario, and 8.9 times under a blue sky scenario. They also noted that the impact could be even higher due to Solana’s active use in staking and decentralized applications, which could result in a non-linear relationship between relative flows and relative size.

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