Standard Chartered Report: Solana Overvalued Compared to Ethereum, U.S. Election Impact on Crypto Market
Solana Overvalued Compared to Ethereum, U.S. Election Could Impact Performance
A recent report from Standard Chartered has suggested that Solana (SOL) may be overvalued compared to Ethereum (ETH) based on key metrics. The British multinational bank predicts that Solana could see significant growth by 2025, potentially outpacing both Ethereum and Bitcoin.
Geoffrey Kendrick, Global Head of Digital Assets Research at Standard Chartered, highlighted new valuation metrics for layer-1 blockchains, focusing on Solana and Ethereum. He pointed out that Solana’s market capitalization to fees ratio is significantly higher than Ethereum’s, indicating a potential overvaluation of the SOL token.
Despite Solana’s impressive growth potential, Kendrick believes that the upcoming U.S. presidential election could have a significant impact on the performance of Solana, Ethereum, and Bitcoin. If Donald Trump were to win the election, Kendrick expects a more favorable environment for digital assets, potentially leading to a surge in Solana’s value.
Token Supply and Staking Yields Compared
While Solana has been gaining traction in the cryptocurrency market, the report also highlighted some key differences between Solana and Ethereum. Solana’s token supply increases at a faster rate than Ethereum’s, and its staking yield is lower compared to Ethereum.
Additionally, Ethereum has a larger developer community, with 38% of blockchain developers working on the Ethereum ecosystem compared to only 9% working on Solana. These factors could impact the long-term growth and adoption of both platforms.
Impact of U.S. Election on Crypto Regulations
The report also considered how the outcome of the U.S. election could influence cryptocurrency regulations. If Donald Trump were to win, analysts predict a more positive regulatory environment, potentially leading to the approval of Solana exchange-traded funds (ETFs) and boosting the value of SOL.
On the other hand, if Kamala Harris were to become president, the regulatory landscape could become more stringent, with Bitcoin likely to lead the market. Ethereum and Solana may face challenges under a Harris administration.
Despite the potential uncertainties surrounding the U.S. election, Standard Chartered remains optimistic about the future of cryptocurrency. The bank predicts that Ethereum could reach $7,000 by the end of 2025 under a Harris presidency and up to $10,000 if Trump remains in power. Bitcoin is expected to reach $200,000 by the same year-end, regardless of the election outcome.
As the cryptocurrency market continues to evolve, investors will be closely watching the developments surrounding Solana, Ethereum, and Bitcoin, especially in the lead-up to the U.S. election.
