Solana (SOL) is on a tear, and analysts predict it’s on course to become the third-largest cryptocurrency by market cap in 2024, surpassing rivals like XRP and Cardano. This positions SOL as a major force in the crypto landscape, trailing only the established giants Bitcoin and Ethereum.

Here’s a deeper dive into what’s propelling Solana’s meteoric rise:

ETF Greenlight on the Horizon

The biggest news for SOL is the recent application filings for the first-ever Solana ETFs by VanEck and ARK 21Shares. If approved by the SEC, these ETFs would allow traditional investors to easily gain exposure to SOL, potentially mirroring the price surge witnessed by Bitcoin after its ETF launch in January.

Analyst Confidence is Sky High

Renowned crypto analyst Raoul Pal isn’t holding back his enthusiasm for Solana. He believes SOL will lead the next crypto market boom, citing groundbreaking innovations like Solana’s NFT compression technology, which enables massive NFT scaling at a fraction of the cost. Additionally, Pal is impressed by Firedancer, a development that reportedly convinced him to go “all in” on Solana, allocating a significant portion of his net worth to SOL.

BlackRock and the Private Market Playbook

BlackRock’s recent acquisition of Preqin, a private market data provider, hints at a potential future Solana ETF from the investment giant. BlackRock’s CEO, Larry Fink, has expressed interest in “indexing the private markets,” a strategy that could be applied to Solana if it avoids classification as a security by the SEC.

Solana’s Staking Advantage

Solana boasts a healthy staking ratio, with over 60% of SOL tokens currently locked up. This not only secures the network but also allows platforms like Sanctum and Jito Labs to offer lucrative liquid staking options. Solana’s edge lies in its shorter unbonding period (two days) compared to competitors like Ethereum, making it more attractive for users seeking flexible staking options.

Memecoins Fueling the Hype

The rise of meme coins has been a double-edged sword for Solana. While a significant number of these meme coins launched on Solana are eventually abandoned, the popularity of platforms like Pump.fun, a Solana-based meme coin launchpad, has undeniably boosted Solana’s transaction volume and overall economic activity. Data from DeFiLlama shows Pump.fun has surpassed a staggering $50 million mark in cumulative revenue.

Flipping Ethereum? Not a Fluke

Keep an eye on Solana’s trading volume. It’s repeatedly surpassed Ethereum in daily DEX (decentralized exchange) trading volume, most recently on July 1st, with a staggering $848.71 million compared to Ethereum’s $778.66 million. This isn’t a one-time event; the frequency of these “flips” is increasing, raising speculation that Solana might permanently dethrone Ethereum as the DEX volume leader. Solana’s low transaction fees make it capital-efficient, attracting high-frequency traders and contributing to its impressive DEX volume, even with a smaller total value locked (TVL) compared to Ethereum.