Solana is in the red for now, but the cryptocurrency is one of the best performers. Over the past year of trading, SOL, the native coin of the Solana ecosystem, has increased more than 15x, quickly climbing back to number five in the cryptocurrency rankings, toppling XRP, Cardano, and even top meme cryptocurrencies like Dogecoin.
GSOL is trading at a 650% premium
SOL could see more in the coming weeks. Data shows that the Grayscale Solana Trust (GSOL) is trading at a 650% premium to its net asset value (NAV).
According to Jamie Coutts, chief cryptocurrency analyst at Real Vision, the point in the NAV premium follows the wave of Solana spot exchange-traded funds (ETFs) in the United States and Canada.
To understand what’s happening, the GSOL NAV generally represents the total value of all SOLs held by the trust, divided by the number of GSOL shares outstanding. GSOL is trading at a price above or below net asset value, it would be selling at a discount Or a huge bonus.
When GSOL is trading at a price above the net asset value, it is available at a premium, meaning people are willing to pay more for the underlying asset, in this case, SOL.
GSOL is now available at a high price, partly due to the limited supply. Only a few shares are listed for trading, unlike the free-trading SOL available on several cryptocurrency exchanges like Binance or Coinbase.
As a result, institutions expecting prices to rise in the coming months may have to compete with others to gain exposure to SOL via GSOL, leading to higher premiums.
Eyes On Spot Solana ETF Apps in the US and Canada
Solana is expected to outperform Bitcoin and Ethereum in the coming months, extending gains from the first quarter of 2024. The outlook follows VanEck and 21Shares’ decision to deposit for Solana cash exchange-traded funds (ETFs) with the U.S. Securities and Exchange Commission (SEC) in late June.
In their filing, VanEck, through its head of digital asset research, Matthew Sigel, said Their product will aim to leverage Solana’s decentralization, utility, and economic viability. The executive also added that SOL is qualified to be a commodity like Bitcoin.
Despite the request, the chances of the Solana spot ETF being approved by the regulatory agency remain slim. Unlike Bitcoin and Ethereum, whose futures products are available on CME, SOL is not listed on an exchange. At the same time, the US SEC cited SOL as one of many unregistered securities when it sued Binance and Coinbase.
Main image from Canva, chart from TradingView
