In a research note by Standard Chartered, the potential impact of the U.S. election on the cryptocurrency market is analyzed. The head of digital assets at the bank, Geoffrey Kendrick, outlined his expectations for bitcoin, ether, and solana depending on whether former President Donald Trump or Vice President Kamala Harris wins the presidential election. Solana, a cryptocurrency launched in 2020, is designed to be faster than other cryptocurrencies and enables developers to create applications, similar to ether. While bitcoin is primarily used for transactions, solana has the potential for more extensive development due to its design.
Under a Trump presidency, Kendrick predicts solana could soar by 400%, with ether increasing by 300% and bitcoin by 200% by 2025. This would see solana reaching over $700, ether over $9,650, and bitcoin over $185,000. Kendrick believes that a Trump administration would be more supportive of the digital assets ecosystem, making it more likely for a solana ETF to be introduced. In contrast, if Harris wins the election, Kendrick expects bitcoin to outperform ether, with ether outperforming solana in 2025. Under a Harris administration, he predicts ether to end at around $7,000, compared to $10,000 under Trump.
While Kendrick is bullish on solana’s performance under a Trump presidency, he acknowledges that the cryptocurrency’s current valuation appears “richly priced” compared to ether based on various metrics. These include solana’s market capitalization-to-transaction fee ratio, overall net issuance of the token, and real staking yield. Kendrick notes that solana’s rich valuation would require a significant increase in throughput, possibly 100-400 times over the next few years, which may be more feasible under a Trump administration due to its friendliness towards the digital asset ecosystem.
The comparison between solana, ether, and bitcoin under different U.S. election outcomes highlights the potential impact of government policies on the cryptocurrency market. Kendrick’s analysis suggests that a Trump presidency could be more favorable for solana and the broader digital assets ecosystem, leading to significant gains for the cryptocurrency. However, he also cautions that solana’s current valuation may be overstretched, requiring substantial growth in throughput to justify its price. Understanding the potential implications of political events on the cryptocurrency market is crucial for investors looking to navigate the volatile and rapidly changing landscape of digital assets.
