The cryptocurrency market is breaking records following Donald Trump's confirmation as the 47th President of the United States. Although the main focus remains on Bitcoin, which is approaching $90,000, other altcoins are performing even better. Solana, for example, has outperformed Bitcoin, delivering a return of over 36 per cent in the last week.
Solana is the fourth largest token, with over $102.5 billion in market cap. With the recent rally, its price has surged past $200 and is indicating further potential increases.
There is no doubt that Solana’s prices are benefiting from the current positive market sentiment. However, other factors are also at play.
The “Ethereum Killer”
Launched in 2020, Solana operates on a proof-of-stake protocol, predating Ethereum’s switch from proof-of-work. The Solana blockchain is designed to host decentralised applications and has gained significant attention. Due to its efficiency, it has sometimes been called an “Ethereum killer.”
Although Solana is only a quarter of the size of Ethereum, the only cryptocurrency between these two in size is Tether, a stablecoin. Thus, Solana is one of the most influential cryptocurrencies in the market.
One reason behind the latest crypto rally is Donald Trump’s endorsement of cryptocurrencies. President-elect Trump attended multiple Bitcoin conferences during his campaign and announced he would become the first “Bitcoin President.”
With Trump's endorsement, the crypto industry anticipates deregulation over the next four years. The Securities and Exchange Commission’s Chair, Gary Gensler, who engaged in several high-profile conflicts with crypto companies, is also expected to be replaced soon.
Solana applications just flipped Ethereum applications in total revenue generated.Total application revenue is one the strongest indicators of value creation in an ecosystem, and Solana is now in the lead. pic.twitter.com/DEQScQNSH1
— Ryan Watkins (@RyanWatkins_) November 12, 2024
Spot Solana ETF Next?
One of the most encouraging factors for Solana is the possible listing of a spot Solana exchange-traded fund (ETF) on US exchanges. Last July, Cboe officially requested the SEC to permit the listing of Solana ETFs by two issuers, VanEck and 21Shares, who also submitted S-1 forms with the regulator.
Although the US regulator has not yet taken action on the spot Solana ETF, a Trump-appointed, crypto-friendly SEC chief replacing Gensler may approve the instrument.
Notably, the SEC approved the listing and trading of spot Bitcoin ETFs on US exchanges last January, followed by the approval of Ether ETFs. While such ETFs are already traded on the stock exchanges of several other countries, the US listing, due to the size of the market, provided a significant boost.
This article was written by Arnab Shome at www.financemagnates.com.
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