Solana-ETF Hopes and Price Outlook
2025-02-12
Category: None

VanEck's Matthew Sigel and Patrick Bush recently shared their Solana price prediction on X (formerly known as Twitter). I will copy their text for you here.

 VanEck 

 Our Solana Price Target by the End of 2025 is $520

We value Solana (SOL) based on its projected year-end market share within the smart contract platform (SCP) market. Our SCP market cap forecast is derived from U.S. M2 money supply growth, given its 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. Historical data shows a strong correlation between M2 and SCP market cap, with a 12-month moving average R² of 0.36 and a t-statistic of 5.7 (p < 0.0001).

Currently, Solana holds 15% of SCP market cap, but we forecast its share to rise to 22% by EOY 2025. This projection is supported by Solana’s developer dominance, increasing market share in DEX volumes, revenues, and active users. Using an autoregressive (AR) forecast model, we estimate Solana’s market cap will reach ~$250B, implying a SOL price of $520 based on ~486M floating tokens. 

The $520 price target is unlikely to be achievable without the approval of a Solana-based spot ETF in the U.S. Therefore, we should assess the likelihood of such approval and when it might occur.

 ETF Approval Date 

Currently, there is some misleading information circulating on social media claiming that BlackRock CEO Larry Fink stated that the SEC will approve a spot ETF in the U.S. as early as February 2025. In reality, Larry Fink never made such a statement. The creators of these fake screenshots likely used Photoshop to fabricate them.



According to official information, the SEC is expected to make a decision on the Solana-based ETF between October 2 and October 18. Now that the timeline is clear, let's discuss the odds.

 ETF Approval Odds 

Bloomberg analysts James Seyffart and Eric Balchunas have estimated the likelihood of approval for various cryptocurrency ETFs in 2025. Data from their table indicates that they estimate a 70% chance of a Solana ETF being approved in 2025.



We can gauge market expectations using the Polymarket platform. Currently, there are two betting options available. Only 36% of participants are betting that SEC approval will be granted in the first half of 2025.



Meanwhile, 84% of participants are betting on SEC approval occurring at some point in 2025.



Based on this data, it is more likely that approval will be granted, but only in the second half of 2025.

 Technical Analysis 

On the chart, we can clearly see the channel within which the price has been moving for several months.



At the moment, the market is bearish in the short term. For this reason, it is highly likely that the price will approach the lower boundary of this channel in the coming months. This roughly corresponds to a price of $170. Buying at $170 or even lower would be an excellent opportunity to open a long position. However, for the trade to be successful, the price needs to remain above the lower boundary of the channel.