Solana Price Prediction: VanEck Forecasts Potential Surge to $520 by Year-End

Asset manager VanEck has released its latest forecast for Solana (SOL), predicting the altcoin’s price could more than double to hit $520 by the end of 2025. According to VanEck analysts, this projection takes into account Solana’s year-end market share in the smart contract platform (SCP) space and U.S. M2 money supply.

Forecast Methodology

VanEck’s head of digital assets research Matthew Sigel and crypto research analyst Patrick Bush explained their valuation approach:

“We value Solana (SOL) based on its projected year-end market share within the smart contract platform (SCP) market. Our SCP market cap forecast is derived from U.S. M2 money supply growth, given its strong historical correlation with crypto market capitalization.”

Market Projections and Growth Rate

Per the forecast, the U.S. M2 money supply is expected to grow to $22.3 trillion by the end of the year, rising at an annualized growth rate of 3.2%. Through regression analysis, VanEck estimates the total smart contract platform market capitalization will hit $1.1 trillion by the end of 2025, representing a 43% spike that will see the SCP surpass the 2021 peak of $989 billion.

Solana’s Market Share and Price Implications

VanEck notes that the correlation between M2 and the market cap of SCP has historically been strong. If this trend continues, a surge for Solana’s share of SCP market cap could drive the native token’s price higher. Currently, Solana holds 15% of SCP market cap, but VanEck forecasts its share to rise to 22% by the end of 2025, supported by Solana’s developer dominance, increasing market share in DEX volumes, revenues, and active users.

Price Prediction and Market Capitalization

Using an autoregressive forecast model, Sigel and Bush see Solana’s market cap soaring to approximately $250 billion, implying a SOL price of $520, based on the altcoin’s 486 million floating tokens. At the time of writing, Solana price hovered near $189, down nearly 5% in the past 24 hours and -21% in the past week. However, SOL is up 98% in the past year and reached a new all-time high above $294 on January 19, 2025.

Tips for Investors

  • Keep an eye on Solana’s market share in the SCP space and its impact on the token’s price.
  • Monitor the U.S. M2 money supply growth and its correlation with crypto market capitalization.
  • Consider the potential for Solana’s developer dominance and increasing market share in DEX volumes, revenues, and active users to drive the token’s price higher.

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