VanEck Forecasts Solana's Price Surge By 2025

According to CoinDesk, investment firm VanEck has projected that Solana's cryptocurrency, SOL, could reach a value of $520 by the end of 2025. This prediction is based on the anticipated growth in demand for smart contract platforms (SCP) and an increase in the M2 money supply in the coming months. The M2 money supply, which includes cash, checking deposits, and easily convertible near money like savings deposits and money market funds, is a key indicator of the amount of money circulating in the U.S. economy. It often influences the crypto market. VanEck forecasts that the M2 money supply will rise from the current $21.5 trillion to $22.3 trillion by 2025. When central banks increase M2 through measures like lowering interest rates or quantitative easing, it results in more liquidity in the economy, encouraging investments in risk assets such as cryptocurrencies. The SCP market, where platforms like Solana operate, is expected to grow significantly. These platforms facilitate the creation and execution of smart contracts. VanEck estimates that the SCP market could expand by 43%, reaching $1.1 trillion by the end of 2025. Solana currently holds about 15% of this market, but VanEck anticipates its share will increase to 22% by the end of 2025. The firm attributes this growth to Solana's developer dominance and its increasing market share in decentralized exchange (DEX) volumes, revenues, and active users. Using an autoregressive (AR) forecast model, which analyzes past data to predict future values, VanEck estimates Solana's market capitalization will reach approximately $250 billion, implying a SOL price of $520 based on around 486 million floating tokens. In addition to these projections, VanEck is among several U.S. firms that filed for a Solana ETF in 2024. The U.S. Securities and Exchange Commission (SEC) had previously rejected several applications for ETFs tracking SOL and instructed Cboe to remove its previously uploaded 19b-4s for those ETFs. However, in a recent development, the SEC acknowledged a filing by Grayscale for its SOL ETF, indicating that the commission now has until October to approve or deny the application. This shift in the SEC's stance could have significant implications for the future of Solana and its market presence.