Solana to $1,000? Why a Spot ETF could be the final catalyst for SOL’s price

Key Takeaways

What are the price targets for Solana this year?

Based solely on technical analysis, a $473 target appeared viable for Solana in the coming months.

Will Solana witness institutional demand on the scale of BTC or ETH?

If the U.S. SEC approves the ETF applications in October, it will boost demand and likely lead to greater demand for SOL from treasury companies, as the token grows in legitimacy in investors’ eyes.

In a report from October 2023, global investment management firm VanEck modeled a scenario where Solana [SOL] is the first blockchain to onboard more than 100 million users.

This was done as an SOL valuation project. Their bull case gave a $3,200 price target for Solana by 2030.

At that time, they could not have predicted the game-changer that digital asset treasury companies (DATs) for altcoins, and especially spot exchange-traded funds (ETFs), could be. Is a $1,000 SOL price target viable for this cycle?

ETF and treasury demand will be a massive boost to demand and legitimacy

In 2020, Michael Saylor, co-founder of Strategy [MSTR], made a bold bet. As an inflation hedge, he began acquiring billions of dollars worth of Bitcoin [BTC].

It was a high-risk, high-reward strategy, the first in crypto, with innovative financial instruments and debt fueling further BTC purchases.

Bitcoin treasury companies now hold 3.76 million BTC, worth $410.4 billion at current market prices. Ethereum [ETH] treasury companies are also in the market, holding $14.8 billion worth of ETH. Solana treasury companies held $2.6 billion worth of SOL.

The latter altcoins were later to the digital asset treasury conversation (DAT) and will lag behind BTC, but it throws into light the sheer scale of demand that can be spurred by DATs.

ETFs could be a notable catalyst for Solana’s growth, in terms of price as well as legitimacy in the market. Right now, the Rex Osprey staking SOL ETF is the only investment vehicle that offers spot exposure.

Grayscale’s spot Solana ETF faces its approval deadline date on the 10th of October.

Four other applications with a final deadline of the 16th of October are set to be reviewed by the U.S. Securities and Exchange Commission (SEC). These are Bitwise, 21shares, VanEck, and Canary. If approved, SOL will join a league of elite crypto assets, easily available to investors.

The timing could be crucial. Solana might be approaching its “institutional moment”.

In a post on X (formerly Twitter), venture capital and hedge fund firm Pantera Capital noted that SOL was “approaching a major inflection point in its adoption—by consumers, fintechs, & institutions”.

As AMBCrypto observed earlier, Solana has a lot of catching up to do on the ETF front, as well as company holdings.

Source: SOL/USDT on TradingView

While ETF approval could serve as the final catalyst for bullish momentum, a $1,000 SOL target remains highly ambitious for this cycle. 

Earlier this year, the weekly chart showed a retracement to the 61.8% Fibonacci level, followed by a strong recovery. 

Despite dipping below $200, the trend has turned bullish, with Fibonacci extension levels pointing to potential targets of $363 and $473 in the coming months.