Solana Set to Outperform Ethereum and Bitcoin by 2025
According to a recent report by Standard Chartered, Solana (SOL) is expected to outperform Ethereum (ETH) and ETH to outperform Bitcoin (BTC) in 2025. The British multinational bank predicts a fivefold increase in SOL’s Price if Donald Trump wins the U.S. presidential election. Let's delve into the details of this projection and what it means for the cryptocurrency Market.
New Valuation Metrics for Layer-1 Blockchains
Geoffrey Kendrick, the Global Head of Digital Assets Research at Standard Chartered, introduced new valuation metrics for layer-1 blockchains, focusing primarily on Solana and Ethereum. Kendrick also shared his expectations for Bitcoin, projecting it to hit $200,000 by the end of 2025, regardless of the election outcome.
Kendrick noted that Solana is currently valued higher compared to Ethereum based on various backward-looking metrics.
- SOL: Valued at 250x market cap-to-fees ratio
- ETH: Valued at 121x market cap-to-fees ratio
This high valuation for SOL implies market expectations of significant Growth for Solana, with throughput expected to increase by 100-400x in the coming years.
Kendrick highlighted the potential impact of the U.S. presidential election on these valuations, suggesting that Solana’s Growth would be more significant under a Trump presidency due to a more favorable environment for the digital asset ecosystem.
Scenarios Based on Election Outcome
Kendrick outlined different scenarios based on the election outcome, projecting that under a Trump victory, SOL would outperform ETH and ETH would outperform BTC by 2025. The report anticipates substantial growth for all three cryptocurrencies, with Solana potentially seeing a 5x increase, Ethereum a 4x increase, and Bitcoin a 3x increase by the end of 2025.
However, Kendrick's outlook changes under a potential Kamala Harris administration, with BTC expected to outperform ETH and ETH to outperform SOL in 2025.
Price Targets for Ethereum
Standard Chartered provided specific price targets for Ethereum, estimating that under a Trump presidency, ETH could reach around $10,000, while under a Harris administration, the price target is projected to be $7,000.
This analysis provides valuable insights into the potential performance of different cryptocurrencies based on the political landscape, highlighting the relevance of external factors in the volatile Cryptocurrency market.
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Edited by Stephen Graves.
