Solana Is 'Richly Valued' Versus Ether, But Could Still Outperform If Trump Gets Elected: Standard Chartered

As a seasoned researcher with years of experience in the crypto market, I find myself intrigued by the latest report from Standard Chartered Bank. The political landscape of the United States seems to be playing a significant role in shaping the future of Solana (SOL), Ethereum (ETH), and Bitcoin (BTC).

As a crypto investor, I find Solana (SOL) appearing somewhat overvalued in comparison to Ethereum (ETH), according to my analysis of several key metrics. However, it’s essential to remember that the performance of these tokens, as well as their relationship with Bitcoin (BTC), seems heavily influenced by the upcoming U.S. Presidential election. As per a recent report by Standard Chartered Bank, the outcome of this election could significantly impact the crypto market landscape.

According to Geoff Kendrick, who leads digital assets research at the bank, the analysts foresee a possibility of friendlier crypto regulations and increased approval chances for Solana ETFs that trade in the present (spot-based) if Donald Trump wins the election. Conversely, a presidency led by Kamala Harris might have a negative impact on smaller, riskier cryptocurrencies.

According to the team’s predictions, during a Trump administration, Solana (SOL) is likely to outperform both Ethereum (ETH) and Bitcoin (BTC). On the other hand, if Vice President Harris were to take office, Bitcoin (BTC) would reportedly lead the way, followed by Ethereum (ETH), with Solana (SOL) trailing behind, as per StanChart’s forecast.

Despite the uncertainty surrounding November’s election results, the bank’s financial experts maintain their optimistic view towards cryptocurrency. They predict that Ethereum (ETH) could reach $7,000 by the end of 2025 if Joe Biden wins, and potentially soar to $10,000 if Donald Trump is re-elected. It’s worth noting that this bank initially set a year-end 2025 ETH price target of $14,000.

Regardless of who wins the election, there’s a possibility that Bitcoin’s value may skyrocket to around $200,000 over the same timeframe, according to the report.

Solana overvalued versus ETH

It’s widely recognized that Ethereum serves as the leading foundation for blockchain applications. However, the escalating activity on Solana’s blockchain and the swift increase in the value of its token, SOL, have led some cryptocurrency analysts to speculate that a shift in leadership within the crypto space might be imminent.

Despite cryptocurrency valuations not having the same standardization as traditional assets, analysts from Standard Chartered have pointed out several indicators suggesting Solana (SOL) is overpriced relative to Ethereum (ETH).

SOL’s ratio of market capitalization versus network fee revenues is 250, more than double than ETH‘s 121. Solana’s supply grows around 5.5% annually, while ETH’s token inflation rate stands around 0.5% a year, they added. Higher inflation means that SOL‘s real staking yield is 1%, compared to ETH’s 2.3%. Meanwhile, 38% of all established developers in the blockchain industry work on the Ethereum ecosystem, with Solana claiming a 9% share.

According to Kendrick’s analysis of SOL‘s evaluation metrics, the market appears to foresee a highly prosperous growth trajectory for Solana, anticipating an increase in transaction capacity of up to 400 times its current level. He further stated that these valuations would be more justifiable under a Trump administration compared to one led by Harris.

To maintain its existing value, Solana must establish leadership across various high-traffic cryptocurrency sectors like finance, consumer services, and decentralized physical infrastructure (DePIN), and deploy the Firedancer client to enhance operational efficiency, according to the report.

2024-10-08 21:37

Solana Is ‘Richly Valued’ Versus Ether, But Could Still Outperform If Trump Gets Elected: Standard Chartered

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