Standard Chartered Issues First Solana Forecast: A Deep Dive into Institutional Investment Thesis

Standard Chartered, one of the world's largest banking institutions, has made waves in the cryptocurrency community with its inaugural Solana price forecast. Geoff Kendrick, Head of Digital Assets Research at the UK-based bank, projects that SOL will reach $275 by the end of 2025 and climb to $500 by 2029. This marks a significant moment for Solana's institutional legitimacy, as major financial institutions increasingly turn their analytical focus to the high-performance blockchain.

In a comprehensive discussion on the Lightspeed podcast, Kendrick outlined his investment thesis for Solana, explaining the methodology behind valuing layer-one blockchains, the current state of meme coin trading, and how institutional investors perceive the Solana ecosystem. The conversation offered rare insight into how traditional finance approaches cryptocurrency valuation, revealing both the opportunities and challenges facing Solana in its quest for mainstream adoption.

The Timing Behind Standard Chartered's First Solana Coverage

Standard Chartered's decision to issue its first Solana forecast reflects the blockchain's growing prominence in the institutional investment landscape. Kendrick explained that the timing was deliberate, as the bank had been building out coverage of additional cryptocurrencies beyond Bitcoin and Ethereum throughout 2025. The goal was to establish comparative metrics against which Solana could be properly evaluated.

"Obviously, Solana was the big story in 2023 and even 2024," Kendrick noted. "But now that I've built some other stuff out, I felt like I had some metrics against which I could compare Solana, particularly around activity." This methodical approach underscores the institutional preference for data-driven analysis over narrative-based speculation, a shift that could benefit Solana's positioning as a serious investment vehicle.

The timing also coincides with what Kendrick describes as a potential inflection point for layer-one blockchains. As Solana potentially moves beyond its meme coin-dominated phase, the question of what comes next becomes critically important for investors seeking to understand the network's long-term value proposition.

The Bull Case: Multiple Pathways to Upside

Kendrick outlined several scenarios that could drive Solana's price significantly higher than his base case projections. The most straightforward bullish scenario would involve continued dominance in meme coin trading, with activity returning to the elevated levels seen during the Trump coin launch in January 2025. From a valuation perspective, Kendrick emphasized that the source of blockchain activity matters less than the activity itself.

"I don't really mind where the activity comes from. In terms of valuation, I want activity," Kendrick stated plainly. This pragmatic approach cuts through the often moralistic debates about whether meme coin trading represents legitimate blockchain usage, focusing instead on the fundamental driver of blockchain value: transaction volume and fee generation.

However, the more compelling bull case involves Solana successfully transitioning to new use cases that leverage its unique technological advantages. Kendrick specifically highlighted tokenized equities and social applications as sectors where Solana could potentially capture significant market share. These high-turnover, low-transaction-cost applications align perfectly with Solana's architecture, which prioritizes speed and efficiency over the more deliberate security model of Ethereum.

In the most optimistic scenario, where new use cases emerge more quickly than expected, Kendrick suggested prices could reach $450 in 2025—significantly above his $275 base case. This represents a potential upside of more than 60% above his already-bullish projection, illustrating the asymmetric return profile that continues to attract investors to the Solana ecosystem.

The Bear Case: Navigating the Meme Coin Transition

The bearish scenario centers on the possibility that Solana becomes a "one trick pony," unable to transition beyond meme coin trading while competitors like Sui capture emerging use cases. Kendrick acknowledged this risk but characterized it as low probability, given Solana's demonstrated technological capabilities and established developer ecosystem.

A more nuanced concern involves the quality of meme coin trading activity itself. While overall meme coin volume has remained elevated, Kendrick pointed to declining pass-through rates from pump.fun to Raydium—the traditional progression for successful tokens—as evidence that the quality of activity may be deteriorating. "We've got a high level of things starting out, but a lower level of those succeeding," he observed.

This distinction between quantity and quality of activity matters for valuation purposes. Markets appear to be discounting Solana's meme coin-driven activity more heavily than activity on other chains, suggesting investors have already priced in some skepticism about the sustainability of current transaction volumes.

Defending Meme Coin Sustainability

The discussion revealed an interesting tension between Kendrick's cautious stance on meme coin trading and the actual market data. Host Jack Kubinec pushed back on the assumption that meme coins represent an unsustainable activity source, presenting data that told a more nuanced story.

According to Blockworks Research data, meme coin trading volume on Solana has actually increased over each of the past three months, rising from a low of $45 billion in March to $75 billion in May. Notably, this puts the current floor above the previous ceiling—prior to October 2024, the highest meme coin volume month was July at $45 billion.

"The floor today is the ceiling of mid-2024," Kubinec observed, challenging the narrative that meme coin activity is inherently unsustainable. This data suggests that while the extreme spikes of January 2025 may not persist, Solana has established a meaningfully higher baseline of meme coin trading activity that could provide ongoing revenue to the network.

Kendrick's response highlighted the difference between aggregate volume and value capture efficiency. The key metric, he argued, is not just how many meme coins are trading, but how effectively that trading activity translates into ecosystem value. The declining success rate of tokens progressing from launch to established trading venues suggests diminishing returns from meme coin activity.

A New Framework for Valuing Layer-One Blockchains

Perhaps the most technically interesting portion of the conversation involved Kendrick's approach to valuing smart contract platforms. He introduced a "GDP" metric that measures the total fees paid to applications built on a given blockchain, using this as a proxy for economic activity within the ecosystem.

"If you do it across a few chains, you get numbers that look somewhat similar," Kendrick explained. "So that's super helpful. It's sort of like saying the PE for Apple is 10 and the PE for Microsoft is 12." This comparability across chains is crucial for institutional investors who need frameworks that work consistently across different assets.

When applying this market cap to application fee ratio across multiple blockchains, Kendrick found that BNB Chain trades at a slight premium—which he attributes to Binance's captive audience providing a competitive moat—while Solana trades at a discount. This discount reflects the market's skepticism about meme coin activity sustainability, with nearly 100% of Solana's application fees deriving from meme coin trading.

The framework draws parallels to traditional equity analysis, where companies with diversified revenue streams typically command higher valuations than those dependent on single product lines. Ethereum's more diversified application base, despite its technical limitations, may justify a relative premium under this analysis.

The Country Model for Blockchain Valuation

Kendrick extended his analytical framework by comparing blockchains to countries or cities, with application fees functioning as a form of GDP. This conceptual model helps explain how value flows through blockchain ecosystems and how different metrics relate to each other.

"If you think about blockchains as being their own countries or their own cities, the activity in that country or city is interesting to use as a metric," Kendrick explained. Under this model, network fees function like taxes, while net token issuance serves as an analog to government deficits. The fees generated by end users ultimately flow up to impact the overall economics of the chain.

This framework has practical implications for evaluating blockchain health. While Kendrick noted that issuance matters at extremes—pointing to Ethereum's brief period of negative issuance before the Dencun upgrade—he suggested that for chains with low single-digit inflation rates, activity metrics matter more than issuance dynamics.

The comparison to traditional corporate equity analysis is instructive. Amazon, for example, has averaged roughly 1.5% annual stock issuance over the past decade—similar to the 4-5% range seen across major layer-one blockchains. This contextualization helps institutional investors frame blockchain economics in familiar terms.

The Value Capture Debate

A significant portion of the discussion centered on a fundamental question: does application revenue appropriately measure layer-one value, or should direct fee capture to validators and stakers be the primary metric? This debate has significant implications for how investors should evaluate Solana relative to competitors.

Kubinec challenged the GDP metric by noting that applications could theoretically have high take rates while settling minimal data to the underlying blockchain. In such scenarios, the correlation between application success and layer-one value capture breaks down. Fees paid directly to validators and stakers might provide a more accurate measure of actual value flowing to token holders.

Kendrick acknowledged this concern but framed it as a timing issue. Current blockchain economics are relatively immature, with application take rates still evolving. As the ecosystem matures and applications potentially capture more value for themselves, the relationship between layer-one and application economics will likely shift.

This evolution poses both opportunities and challenges for Solana. The network is reportedly exploring "application-specific sequencing" to address scenarios where breakout applications might prefer to capture value directly rather than passing it through to Solana validators. This proactive approach to value capture dynamics could prove crucial for Solana's long-term competitive positioning.

The Layer-One vs. Layer-Two Value Distribution Problem

The conversation touched on one of the most contentious issues in blockchain economics: how value should be distributed between layer-one blockchains and the applications built on top of them. Kendrick noted that Ethereum's layer-two solutions are "completely minting it from a cash perspective, paying Ethereum almost nothing and taking quite a bit for themselves."

This dynamic, which Kendrick characterized as mismanaged by the Ethereum Foundation, has significant implications for layer-one valuations. If applications eventually capture most of the value in blockchain ecosystems—similar to how app developers capture value in mobile ecosystems—then the premium currently assigned to layer-one tokens may prove unsustainable.

Solana's architecture potentially provides some protection against this value extraction. By emphasizing composability and shared global state, Solana creates network effects that incentivize applications to remain on the main network rather than spinning off into isolated environments. However, this advantage only persists if Solana continues to develop multiple breakout sectors that benefit from direct composability.

"If you go be on your own layer one, people can't move assets there very easily," Kubinec noted. "And that's like a downside. Like I think Solana has to really play into that to outrun this future where apps want to capture more value as opposed to passing it on to Solana validators."

The Tokenized Equity Opportunity

Among potential new use cases for Solana, Kendrick expressed particular enthusiasm for tokenized equities. This application plays directly to Solana's strengths in high-throughput, low-cost transactions while addressing a genuine market need.

"The use case there is for those that can't get access to US trading accounts, for example, that want to trade NASDAQ stocks," Kendrick explained. "They could be sat somewhere in Thailand on their mobile phone and want to trade their favorite MAG seven stock. They don't have access to a US account. They would like to get access to the most liquid financial market system in the world. And this asset class gives them that access."

This democratization of financial access represents exactly the kind of real-world utility that could attract institutional capital to Solana. Unlike meme coin trading, which many traditional investors view skeptically, tokenized equities serve an obvious market need and could potentially attract regulatory support rather than scrutiny.

Importantly, Kendrick argued that Ethereum cannot effectively serve this use case due to its limited throughput and high transaction costs. Even Ethereum's layer-two solutions may struggle with the demands of high-frequency retail trading. This creates a potential opening for Solana to capture a significant market opportunity that aligns with its technical capabilities.

The Bitcoin Thesis and Institutional Flows

Kendrick's bullish outlook on cryptocurrency extends beyond Solana to encompass Bitcoin, which he believes will reach $500,000 by the time President Trump leaves office in January 2029. This projection rests primarily on continued institutional inflows as access to Bitcoin improves globally.

"Before the ETFs in January 2024, there was limited access for investors. Access improved after ETFs, but it is still somewhat limited globally," Kendrick explained. The continued premium in vehicles like MicroStrategy stock demonstrates that global demand for Bitcoin exposure still exceeds available supply through regulated channels.

This improving access dynamic creates a structural tailwind for Bitcoin that should persist for several years. As more investors gain ability to add Bitcoin to their portfolios through regulated vehicles, consistent capital flows should support price appreciation. The volatility reduction that typically accompanies institutional adoption further expands the potential investor base.

The Bitcoin thesis matters for Solana because cryptocurrency markets tend to move together during major rallies. A rising Bitcoin tide typically lifts altcoin boats, suggesting that Kendrick's bullish Bitcoin outlook creates a favorable macro backdrop for Solana's price appreciation.

The Controversial ETH vs. SOL Comparison

Perhaps the most provocative element of Kendrick's analysis involves his near-term outlook for Ethereum relative to Solana. Despite Solana's recent outperformance and stronger fundamental narrative, Kendrick expects Ethereum to outperform in the near term—a prediction that generated significant pushback from the Lightspeed host.

Kendrick's thesis rests on several pillars. First, he argues that much of Ethereum's value capture problems with layer-two solutions have already been priced into the ETH/BTC ratio, which sits at multi-year lows. The market has already punished Ethereum for its mismanagement of the layer-two relationship; further downside may be limited.

Second, Kendrick points to the Ethereum Foundation's recent organizational changes as a potential positive catalyst. The appointment of new co-executive directors and the establishment of Etherealize as an institutional outreach arm suggests a new seriousness about addressing the network's challenges.

"I think the Ethereum Foundation and Etherealize stuff is positive. I think the organization now realizes that it needs to talk to people externally. It needs to engage," Kendrick observed. "Without that, I think Ethereum would be in potentially in trouble. So I think what they're trying to do at the margin is good, but I think it's going to take some time to pay off."

The Stablecoin Wild Card

A significant element of Kendrick's Ethereum thesis involves potential "lucky wins" from stablecoin legislation. With the Genius Act or similar legislation expected to pass, the structural position of stablecoins within the cryptocurrency ecosystem could strengthen significantly. And stablecoins, to date, have been predominantly an Ethereum story.

"The only use case that's existing from the real world in crypto so far, which is stablecoins, in scale, is two-thirds on Ethereum and probably stays that way," Kendrick noted. While Tron has captured meaningful stablecoin market share, institutional and regulated stablecoin activity tends to concentrate on Ethereum.

This creates a scenario where Ethereum could benefit from sector-level tailwinds even as its fundamental competitive position erodes. If stablecoin activity expands dramatically following regulatory clarity, Ethereum's dominant position in that market could drive price appreciation regardless of its challenges in other areas.

However, this thesis faces some challenges. As Kubinec pointed out, much of the stablecoin revenue on Ethereum doesn't involve active trading—assets tend to be deposited and held rather than actively moved. Additionally, significant stablecoin revenue flows to issuers like Circle and distributors like Coinbase (which operates its own layer-two, Base) rather than to Ethereum validators.

Institutional Perception of Solana

The discussion revealed interesting insights into how traditional financial institutions view Solana relative to Ethereum. Despite Solana's technical superiority for many use cases, institutional defaults still heavily favor Ethereum due to familiarity and perceived security.

"Everyone in banks like mine, who perhaps quite frankly know nothing about blockchain at all, but they've heard of Ethereum," Kendrick explained. "Everyone's heard of Bitcoin. Every person on the street and every person that works in a bank is heard of Ethereum. And then like 5% of those in banks have heard of Solana because they've been trading at PA."

This awareness gap creates a self-reinforcing cycle. Institutions build on Ethereum because they trust it; that institutional activity further legitimizes Ethereum; and future institutions follow the established path. Breaking this cycle requires Solana to offer sufficiently compelling advantages to overcome the comfort of Ethereum's familiarity.

Complicating matters, Solana's association with m coin trading may actually hurt its institutional perception in some quarters. Kendrick illustrated this with a hypothetical scenario: proposing a blockchain project within his bank would likely meet with automatic suggestions to build on Ethereum or a layer-two, with Solana's meme coin reputation serving as a barrier to serious consideration.

The Performance Path to Institutional Adoption

Can Solana overcome institutional bias through pure performance? The conversation explored whether superior technical capabilities could eventually trump the comfort factor that currently favors Ethereum.

"Real actual financial stuff starts happening and real money movement," Kubinec suggested, "maybe Solana just by outperforming Ethereum kind of changes people's minds."

Kendrick agreed this was possible, particularly as blockchain use cases evolve from static asset tokenization to more dynamic applications. The current institutional blockchain activity on Ethereum—tokenized money market funds, real-world asset representations—tends to involve assets that "go on and sit there" rather than actively trading. This plays to Ethereum's strengths in security and settlement finality.

However, if and when transaction-intensive applications become dominant, Ethereum's limitations become more apparent. "Ethereum can't do that," Kendrick stated flatly regarding high-frequency tokenized equity trading. "Even quite frankly, the layer twos may not be able to do that, but Ethereum layer one definitely can't do it."

This creates a potential pathway for Solana: as blockchain finance evolves from static tokenization to dynamic trading, the competitive landscape shifts in Solana's favor. Institutions may follow the activity rather than their initial preferences.

Can Solana Do Both Meme Coins and Institutional Finance?

A crucial question for Solana's future involves whether the network can simultaneously serve meme coin traders and institutional financial applications. While technically possible—Solana's throughput can accommodate diverse use cases—the reputational considerations are more complex.

Kendrick drew an interesting comparison to corporate governance. "If this was a corporate and there was an opportunity set to dominate the tokenized equity market at some point, then the corporate would ban meme coin trading," he observed. But Solana's decentralized architecture makes such top-down decisions impossible, which is philosophically central to blockchain technology but creates practical challenges.

If meme coin activity returns to January 2025 levels, Kendrick suggested, the tokenized equity opportunity might go elsewhere due to institutional reluctance to associate with meme-dominated networks. "You wouldn't want to be in Solana and miss out on the golden goose of tokenized equities because you had meme coin trading going on for a while."

This creates a delicate balancing act for the Solana ecosystem. The network needs to maintain its appeal to retail traders and developers who have driven its growth while simultaneously cultivating the institutional relationships necessary for breakthrough applications like tokenized equities.

The Timeline for New Use Cases

A recurring theme throughout the discussion involved the timeline for Solana's transition from meme coins to more diversified applications. Kendrick estimated this transition would take "a year or two," during which markets might become frustrated with Solana's apparent plateau.

"I think it's going to take some time," Kendrick acknowledged when discussing institutional applications. "There could be a lucky win as well for Ethereum that could come at the same time." This window of vulnerability represents both a risk and an opportunity for Solana investors.

The risk is that investors lose patience during the transition period, allowing competitors to capture emerging opportunities. The opportunity is that patient investors who recognize the long-term potential can accumulate positions at favorable prices while the market focuses on near-term activity metrics.

Network effects in technology tend to evolve "slowly and then really, really quickly," as Kendrick noted. This dynamic means that Solana's position could strengthen dramatically once a breakthrough application gains traction, even if the path to that point appears uncertain from today's vantage point.

Social Applications and Content Networks

Beyond tokenized equities, Kendrick identified social applications as a potential growth vector for Solana. However, he expressed less conviction about timing and specific winners in this category compared to financial applications.

"At some point, there will be a use case for a social network that replaces some of the MAG seven versions of social," Kendrick suggested. But unlike tokenized equities, where the use case is relatively clear, social blockchain applications face more fundamental questions about product-market fit.

Kubinec pushed back on the social thesis, noting that "content is worth zero, essentially" in digital markets, making blockchain-native social networks challenging to monetize. Some social trading applications have shown promise, but the broader category of blockchain-based content networks remains speculative.

This uncertainty around social applications means that Solana's near-term trajectory depends more heavily on financial use cases. Tokenized equities, payments, and other financial applications have clearer paths to adoption and monetization, even if social applications might eventually prove more transformative.

The Competitive Landscape

Throughout the discussion, Kendrick referenced Sui as a potential competitor that could capture opportunities if Solana fails to execute on its transition strategy. This competitive pressure adds urgency to Solana's need to develop sustainable use cases beyond meme coin trading.

"If you saw signs of that, then that would be negative for Solana," Kendrick noted when discussing the possibility of Sui capturing emerging applications. "And then you could say, actually, Solana was just a one trick pony."

However, Solana maintains significant advantages over emerging competitors. Its established developer ecosystem, proven technology at scale, and existing institutional relationships create barriers that newer networks cannot easily overcome. The question is whether Solana can leverage these advantages to capture new opportunities before competitors mature.

The Role of Issuance in Valuation

The conversation touched on token issuance as a factor in blockchain valuation, with Kendrick taking a nuanced position. While issuance matters at extremes—he cited Ethereum's brief period of negative issuance as significant—moderate inflation in the 4-5% range typical of major layer-ones has limited impact on valuation.

This perspective aligns with traditional equity analysis, where stock-based compensation and share issuance are relevant but rarely decisive factors in valuation. The comparison to Amazon's 1.5% average annual stock issuance helps contextualize blockchain inflation in familiar terms for institutional investors.

For Solana specifically, the implication is that current staking rewards and validator economics are unlikely to materially impact the investment thesis. Activity metrics and use case development matter far more than inflation dynamics at current levels.

The Bridge Period Challenge

Kendrick's base case involves Solana navigating a "bridge period" between peak meme coin activity and the emergence of sustainable new use cases. Successfully managing this transition is crucial to realizing the projected $275 year-end target and $500 2029 target.

"We'd like to now create a bridge to the next use cases, which are high turnover, fast sectors like social or tokenized equities," Kendrick explained. "But that could take time. So markets may be a little frustrated."

This bridge period represents a test of investor conviction. Those who believe in Solana's long-term potential must maintain positions through a period where near-term catalysts may be scarce. The reward for this patience, if the thesis plays out, is participation in potentially exponential growth as new applications gain traction.

Implications for Solana Investors

Kendrick's analysis carries several practical implications for investors considering Solana exposure. First, the $275 year-end target and $500 2029 target provide price anchors from a credible institutional source. Standard Chartered's willingness to issue formal forecasts signals growing institutional acceptance of Solana as a serious investment.

Second, investors should focus on activity metrics as leading indicators of price performance. The GDP metric—total fees paid to applications—provides a useful framework for evaluating ecosystem health. Improvement in this metric, particularly if it reflects diversification beyond meme coins, would support the bullish thesis.

Third, the timeline for new use case development matters significantly for portfolio construction. Investors with multi-year horizons may be comfortable holding through the bridge period, while those seeking near-term returns might prefer waiting for clearer signs of application diversification.

The Path Forward for Solana

Standard Chartered's inaugural Solana forecast represents a significant milestone in the network's maturation. The willingness of a major international bank to issue formal price targets signals growing institutional acceptance and provides a framework for evaluating Solana's investment potential.

Kendrick's analysis suggests that Solana's current valuation discount reflects legitimate concerns about use case sustainability, but that this discount may prove excessive if the network successfully transitions to new applications. The combination of proven technology, established ecosystem, and emerging use cases creates a compelling risk-reward profile for patient investors.

The key variables to monitor include meme coin activity trends, institutional application development, competitive dynamics with networks like Sui, and broader cryptocurrency market conditions. Success on these dimensions would support the bull case; failure could validate the more cautious scenarios Kendrick outlined.

For the Solana ecosystem, the message is clear: the network has proven its technical capabilities, but the next phase of growth requires demonstrating sustainable use cases beyond meme coin trading. The opportunities in tokenized equities, social applications, and other high-throughput financial services are real, but capturing them requires continued execution and ecosystem development.

As Solana navigates this transition, institutional research coverage like Standard Chartered's provides valuable frameworks for understanding progress. The fact that major banks are now formally covering Solana alongside Bitcoin and Ethereum represents meaningful validation of the network's growing importance in the cryptocurrency landscape.

Facts + Figures

• Standard Chartered projects Solana will reach $275 by end of 2025 and $500 by end of 2029 in their inaugural SOL forecast

• Meme coin trading volume on Solana increased each of the past three months: from $45 billion in March to $75 billion in May 2025

• Prior to October 2024, the highest meme coin volume month was July at $45 billion, meaning current floor exceeds previous ceiling

• At peak activity, pump.fun was launching 60,000 new tokens per day on Solana

• Standard Chartered projects Bitcoin will reach $500,000 by January 2029 (end of Trump's term)

• ETH/BTC ratio currently sits at 0.024, with Kendrick targeting 0.02 by year-end

• Stablecoins are two-thirds on Ethereum, representing the largest real-world crypto use case

• In the most bullish scenario, Kendrick suggested Solana could reach $450 in 2025 if new use cases emerge faster than expected

• Amazon's average annual stock issuance over the past decade is approximately 1.5%, comparable to major blockchain inflation rates

• Major layer-one blockchains typically have net issuance in the 4-5% range

• Blackrock's BUIDL tokenized fund is 95% on Ethereum

• Kendrick estimates only about 5% of bank employees have heard of Solana, compared to near-universal awareness of Bitcoin and Ethereum

• Pass-through rates from pump.fun to Raydium have fallen dramatically compared to January 2025 levels

• The market is currently discounting Solana's meme coin activity more heavily than comparable activity on other chains like Ethereum, Avalanche, and BNB Chain

• Standard Chartered positions Solana's valuation discount at roughly 100% meme coin concentration, versus more diversified portfolios on competing chains

Questions Answered

What is Standard Chartered's price prediction for Solana?

Standard Chartered projects Solana will reach $275 by the end of 2025 and $500 by the end of 2029. These targets represent the bank's first formal Solana forecast, marking a significant milestone in institutional coverage of the asset. The projections assume Solana successfully navigates a transition from meme coin-dominated activity to more diversified use cases, though the timeline for this evolution remains uncertain. In the most bullish scenario, where new applications emerge faster than expected, Kendrick suggested prices could reach $450 in 2025.

How should investors value layer-one blockchain tokens like Solana?

According to Standard Chartered's Geoff Kendrick, the best metric for valuing layer-one blockchains is a "GDP" measure that totals all fees paid to applications built on the chain. This metric provides comparable results across different blockchains, with market cap to GDP ratios falling in similar ranges (50s to 100s) across major chains. The framework mirrors traditional equity analysis, where diversified revenue streams typically command higher valuations than concentrated exposure to single product lines. Currently, Solana trades at a discount to peers because nearly 100% of its application fees derive from meme coin trading.

Is meme coin trading on Solana sustainable?

The sustainability of meme coin trading remains debated. While overall volume has increased in recent months—rising from $45 billion in March to $75 billion in May 2025—qualitative indicators suggest declining effectiveness. Pass-through rates from pump.fun to Raydium have fallen significantly, meaning fewer launched tokens achieve sustained trading success. The market appears to discount meme coin-driven activity more heavily than diversified blockchain usage, suggesting investors have priced in some skepticism about long-term sustainability.

Why does Standard Chartered expect Ethereum to outperform Solana near-term?

Kendrick argues that much of Ethereum's value capture problems with layer-two solutions have already been priced in, while Solana's transition challenges lie ahead. The ETH/BTC ratio sits at multi-year lows, suggesting limited additional downside. Additionally, organizational changes at the Ethereum Foundation and potential "lucky wins" from stablecoin legislation could provide near-term catalysts. Ethereum's dominant position in stablecoins—roughly two-thirds of the market—could drive appreciation as regulatory clarity emerges, even if fundamental competitive dynamics favor Solana longer-term.

What new use cases could drive Solana's next growth phase?

Tokenized equities represent the most compelling near-term opportunity, according to Kendrick. This application would enable global retail investors to access US stock markets without traditional brokerage accounts, playing directly to Solana's strengths in high-throughput, low-cost transactions. Social applications also offer potential, though timing and specific winners remain more uncertain. These applications require speed and efficiency that Ethereum cannot provide at the layer-one level, potentially creating structural advantages for Solana.

How do institutional investors view Solana compared to Ethereum?

Institutional awareness of Solana significantly lags Ethereum, with Kendrick estimating only about 5% of bank employees have heard of Solana compared to near-universal awareness of Bitcoin and Ethereum. This creates a self-reinforcing cycle where institutions default to Ethereum for blockchain projects, further legitimizing the platform. Solana's association with meme coin trading may actually hurt institutional perception, creating barriers to serious consideration for enterprise applications. However, superior technical performance could eventually overcome these biases as blockchain use cases evolve toward more transaction-intensive applications.

What is Standard Chartered's outlook for Bitcoin?

Standard Chartered projects Bitcoin will reach $500,000 by January 2029, driven primarily by continued institutional inflows as global access improves. Before the ETF launches in January 2024, investor access was significantly limited; even today, the premium in vehicles like MicroStrategy stock demonstrates unmet demand for Bitcoin exposure through regulated channels. As access continues improving and volatility declines with institutional adoption, consistent capital flows should support sustained price appreciation over the coming years.

Can Solana serve both meme coin traders and institutional finance?

While technically possible given Solana's throughput capacity, the reputational implications create practical challenges. If meme coin activity returns to January 2025 levels, institutional reluctance to associate with meme-dominated networks could push tokenized equity and other financial applications to competing chains. Unlike traditional corporations, Solana's decentralized architecture prevents top-down decisions to restrict certain use cases. The ecosystem must navigate this tension carefully to capture institutional opportunities without alienating the retail activity that has driven recent growth.

What metrics should investors monitor for Solana?

Investors should focus on application fee revenue (GDP), meme coin activity quality (pass-through rates), institutional application development, and competitive positioning versus chains like Sui. Improvement in the GDP metric, particularly if reflecting use case diversification, would support the bullish thesis. The emergence of breakthrough applications in tokenized equities or social would validate the transition thesis. Deterioration in these metrics, combined with competitive gains by rival networks, would support more bearish scenarios.