Minority Mindset

Smart investments

Crypto News

Solana ETFs and Huge SOL Gains a Real Possibility Under Trump, Major Crypto Trader Says

Jun 26, 2024

As a researcher with experience in the crypto market, I find the potential impact of the U.S. presidential election on Solana (SOL) and its prospects for an ETF listing intriguing. According to recent reports from market-making firm GSR, if Donald Trump were to win the presidency again, SOL could be closer than many observers think to getting its own ETF in the U.S.

During President Biden’s tenure, Solana (SOL) has yet to receive approval for an Exchange-Traded Fund (ETF) in the United States. However, market-making firm GSR asserts that should Donald Trump regain the presidency, the prospects for a Solana ETF could be more promising than many anticipate, potentially offering greater price appreciation than Bitcoin (BTC) experienced at the time of its spot ETF launch.

According to a recent research report obtained by CoinDesk, the upcoming U.S. presidential election may pave the way for more crypto Exchange-Traded Funds (ETFs) like Solana, depending on the election outcome. If Trump secures another term in office, he could disrupt the conventional approach to launching crypto ETFs, which is a lengthy process that typically begins with the approval of federally regulated futures contracts – an aspect that Solana currently lacks.

“The note hinted that his proposed administration’s regulations for digital assets might indeed permit the launch of numerous spot ETFs for different digital assets, including SOL. If this occurs, SOL could become the first major cryptocurrency after Bitcoin and Ethereum to have a U.S. ETF.”

As an analyst, I believe that Solana holds significant potential to secure a place in a spot Bitcoin or other digital asset exchange-traded fund (ETF) once regulatory approval is granted in the US. The introduction of such an ETF could potentially result in substantial price movements for Solana, making it an exciting prospect for investors.

As a researcher studying the cryptocurrency market, I have discovered that Solana is among a select few digital assets with robust demand from the market and a highly decentralized network based on our calculations at GSR. These characteristics are believed to influence prospective Exchange-Traded Fund (ETF) issuers’ decisions regarding listing applications.

As a researcher studying market trends, I’ve observed that Bitcoin’s price experienced a significant surge, more than doubling in the months leading up to and following its spot Exchange-Traded Fund (ETF) launch. According to GSR’s analysis, if Solana (SOL) receives only 5% of the inflows that Bitcoin did during this period, its price could potentially triple. This 5% inflow rate is considered a “base case” scenario by GSR, as Solana investment products attracted roughly 5% of the total inflows into Bitcoin between 2021 and the end of 2023 prior to the crypto ETF boom.

If the “blue sky” growth rate of 14% holds true for Solana, its price could potentially surge by nearly nine times, according to GSR’s analysis. Although this rate is much lower than bitcoin’s, Solana’s smaller market size suggests that even a fraction of such growth could lead to significant price movements.

Political uncertainty

Solana does not have an ETF price action because there isn’t a Solana ETF in existence. Moreover, Solana has not yet satisfied the necessary requirement of trading in a regulated futures market for an extended period, which is a prerequisite for Bitcoin and Ethereum (anticipated to soon launch their own ETFs). Consequently, it appears that Solana’s launch under the present regulatory framework is still several years down the line.

“If Donald Trump gets elected president, you’ll be under his authority and free to act according to his decisions,” stated Brian Rudick, a strategist at GSR.

As a crypto market analyst, I would put it this way: Should Trump secure a victory in the election and subsequently honor his campaign pledges regarding cryptocurrencies, there’s a possibility that Solana (SOL) could experience significant progress toward being approved as an exchange-traded fund (ETF) within a relatively short timeframe.

As a crypto investor, I’ve noticed that there’s been a lot of buzz about potential crypto ETFs hitting the market soon. However, I must caution that this is still a big “if.” The market hasn’t given us clear signs that this is imminent yet. One metric that some analysts use to gauge the likelihood of an ETF launch is the discrepancy in pricing between Grayscale’s crypto trust products and their underlying assets. If this gap narrows or even closes, it could be a strong indication that the SEC (Securities and Exchange Commission) is getting closer to approving a Bitcoin ETF, for instance. But until then, we’ll have to remain patient and keep an eye on any developments in this area.

If the chances of a successful SOL ETF were higher, then the price of Grayscale Solana Trust (GSOL) might decrease significantly.
As a researcher studying the financial market, I’ve observed that the Grayscale Solar Energy Trust (GSOL) was trading at approximately seven and a half times its net asset value during my latest analysis. This substantial difference is quite astonishing and was also pointed out by Rudick. Notably, he mentioned that this disparity might diminish if GSOL were to be transformed into an Exchange-Traded Fund (ETF), as had occurred with Grayscale’s Bitcoin Trust (GBTC) once it made the transition to an ETF.
Rudick pointed out that the comparison isn’t definitive since GSOL has limited liquidity. In simpler terms, there aren’t many potential buyers available for those looking to sell their overpriced trust shares in GSOL.

Read More

2024-06-27 16:21