Investment firm VanEck has presented a forecast for Solana (SOL), predicting the token’s price could reach $520 by the end of 2025. This forecast is based on the growth of the smart contract platform market, which, according to analysts, is closely linked to the increase in M2 money supply in the U.S.
It is expected that by the end of 2025, the M2 money supply in the U.S. economy could reach $22.3 trillion, potentially driving the expansion of the smart contract platform market by 43%, up to $1.1 trillion, compared to the current $770 billion.
Solana's Market Share May Increase to 22%
Analysts note that currently, Solana holds 15% of the smart contract platform market. However, they forecast its share will grow to 22% due to increased developer activity, higher transaction volumes on decentralized exchanges (DEXs), and growing ecosystem revenues.
According to VanEck, in this scenario, Solana’s market capitalization could reach $250 billion, which, with the current circulating supply of 486 million coins, would result in a price of $520 per SOL.
Impact of Money Supply on the Crypto Market
VanEck experts link the growth of the crypto market to the dynamics of the M2 money supply in the U.S. Historical data shows a correlation between these factors at an R² level of 0.36 with a t-statistic of 5.7 (p < 0.0001).
Based on the company’s calculations, with an average annual growth of M2 at 3.2%, the smart contract platform market could exceed the previous peak of $989 billion reached in 2021.
Potential Launch of Solana ETF
Previously, VanEck’s head of digital assets research, Matt Sigel, stated that the company expects approval of a spot Solana ETF by the end of 2025. This could be a significant factor in attracting institutional capital and further boosting the asset’s price.
However, analysts emphasize that these forecasts are only potential scenarios, and the actual price dynamics of Solana will depend on many factors, including the macroeconomic situation and competition in the smart contract platform market.
Read also:
- Bitcoin Could Reach $1.5 Million by 2030 — Ark Invest Report
- SEC Begins Review of Litecoin ETF Application, LTC Price Surges 19%
This post is for informational purposes only and is not an ad or investment advice. Please do your own research making any decisions.