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- The host of InvestAnswers, a popular crypto analyst, suggests that Solana (SOL), an Ethereum competitor, is significantly undervalued.
- According to the analyst, Solana’s market cap should be at least 1/10th that of Ethereum, indicating a potential nearly 3x increase from its current market cap.
Solana’s Value Unjustifiably Low Compared to Ethereum
A renowned crypto analyst from InvestAnswers believes that Solana (SOL), a strong contender against Ethereum (ETH), is currently undervalued. In a recent update, the anonymous host shared with his 444,000 YouTube subscribers that the daily active addresses on Solana rival those on Ethereum, yet its market cap is only 1/25th of Ethereum’s.
He noted that Solana outperforms Ethereum in transactions, activity levels of users on the chain, and the range of decentralized applications (DApps). Despite these advantages, the market has not reflected this superiority in Solana’s valuation.
“This is a crazy thing that’s going on – it’s mind-boggling, but sometimes markets are irrational,”
he commented.
Solana’s Market Cap Predicted to Surge
The analyst asserts that Solana’s market cap should be at least 1/10th of Ethereum’s, as a “bare, bare minimum”. With Ethereum’s market cap standing around $227.5 billion at the time of writing, a tenth of that would be approximately $22.75 billion.
Comparatively, Solana’s current market cap is just $8.1 billion. This suggests that reaching 1/10th of Ethereum’s market cap would represent almost a threefold jump for Solana.
“It’s hard to say exactly where this can go, because there’s no solid trading pattern between both,”
stated the InvestAnswers host.
He further explained that Solana has been
“bleeding against ETH for the last year with the FTX debacle”
and that it needs to break out. He suggested a breakthrough would occur when it surpasses $30, and then Solana could be
“off to the races”.
At the time of writing, Solana was trading at $20.57 and ranked as the 11th-largest crypto asset by market cap, down slightly over 1% in the past 24 hours.