Why Solana Is Poised To Smash $330 Price Milestone And Capture 50% Of Ethers Market Cap
According to data from CoinGecko, among the top ten major cryptocurrencies by market value, Solana (SOL) has registered considerable gains over the past seven days (7.5%), even surpassing Bitcoins 1.8% growth.
According to VanEck, at press time, SOL is trading for $155 and appears ready to extend its bullish momentum to hit $330 and reach 50% of Ethers market capitalization.
Solana Beats Ethereum In Key Areas
In a Sept. 25 report, VanEcks research department, MarketVector, noted that Solana has beaten Ethereum in several important areas. For instance, the reports authors observed that Solana has a high throughput and can process thousands of transactions per second, which is roughly 3,000% higher than Ethereums TPS.
Moreover, Solana boasts 1,300% more daily active users than Ether, and its transaction fees are 5 million percent cheaper, making it a more efficient and scalable network.
The report highlights decentralized finance (DeFi), stablecoins, and payments as key areas where Solana can challenge Ethereum. Solanas ability to transcend Ethereum in terms of speed and costs gives it an edge in the fast-growing sector.
Another major use-case is lending and borrowing within the DeFi space, a sector expected to continue growing at a rapid pace. Payments and remittances also hold massive potential, especially with Solanas lower fees and faster transaction times. If institutions and everyday users can save money through cheaper, faster transactions, Solanas user base could grow even more rapidly, VanEck stated.
The authors wonder why we havent yet witnessed a massive exodus toward Solana from Ethereum, particularly from institutions, despite these impressive SOL statistics.
In terms of institutional adoption, Solana trails behind its older rival, which won further validation in July this year when United States regulators gave the nod to nine spot Ethereum exchange-traded funds (ETFs). Although demand for these ETH instruments is rather lackluster, the approval indicates that institutional investors now have more appetite for ether.
The landscape around a U.S.-listed spot Solana ETF, remains in limbo. While other countries, like Brazil, have already greenlighted such products, BlackRock execs recently asserted that it will be a while before we see a SOL ETF in America.
Nonetheless, the VanEck analysts observed that retail investors are slowly waking up to Solanas potential to challenge Ethereums status as the smart contracts king.
Is Solana An Undervalued Powerhouse?
VanEck further pointed out that Solanas market cap remains only 22% of Ethereums. The report attributes this huge gap to Ethers first-mover advantage and the wider institutional trust brought on by the ETFs.
However, the researchers believe these advantages wont guarantee Ethereums reign forever. Solana should focus on its strengths to ultimately close this wide gap.
Meanwhile, the report suggested that Solana is grossly undervalued owing to its technical achievements and could potentially reach 50% of Ethereums market cap. Should this materialize, the price of SOL could rocket to $330, given ETHs present price and market cap of $2,635 and $315 billion, respectively.
Text source: ZyCrypto
