Standard Chartered expects Solana to rise 50% by the end of 2025, here are the details:
Standard Chartered has begun coverage of Solana (SOL) with a target price of $275 by the end of 2025, indicating gains of over 50% from current levels of around $175.
While the bank acknowledges that Solana is likely to underperform Ethereum over the next two to three years, it sees long-term potential for the network once new sectors begin to grow.
Geoff Kendrick, Global Head of Digital Asset Research at Standard Chartered, said: "Solana is a fast and cheap alternative to Ethereum; as a result, it has dominated meme coin trading," referring to the network's superior ability to process transactions and its reliability.
However, it is noted that meme coin activity "is being discounted to a measurable extent by the markets," which has contributed to Solana trading "cheaply" relative to its realized application revenues, or "GDP."
Most of Solana's current use is concentrated in trading applications, particularly decentralized exchanges that facilitate high-volume, low-value meme coin transactions. While this has helped test the network's capabilities under pressure, Kendrick warns that the associated revenues may be unsustainable.
The analyst said: "Solana is trading 'cheaply' according to our market cap to GDP measure," attributing this to applying a "more aggressive discount factor" to future earnings compared to other chains.
Kendrick clarified: "In other words, the recent high fees and high activity of Solana amidst meme coin trading may be seen as unsustainable."
Looking ahead, Standard Chartered sees the potential for Solana to dominate emerging sectors such as decentralized social media, high-performance financial applications, and infrastructure platforms, although it expects these use cases to take two to three years to grow.
Kendrick continued: "The key to Solana's future success will be in taking its core advantage of transaction confirmation (fast, cheap, and reliable) and applying it to something other than meme coin trading."
And away from short-term challenges, the analyst expects the price of SOL to reach $310 by the end of 2026 and $500 by the end of 2029. Standard Chartered's target for the end of 2025 is $275.
This is not financial advice, do your own research.