The post Solana could 8.9x as it becomes the next crypto ETF — GSR appeared on BitcoinEthereumNews.com.

Photo by Shubham Dhage on Unsplash. Key Takeaways Solana’s inclusion in a spot ETF could significantly impact its market value. Legislative changes in the US are creating a more favorable environment for crypto ETFs. A recently published report from GSR Markets, one of the biggest crypto market makers, analyzed how Solana could gain 8.9x as it progresses towards becoming the next crypto ETF after Bitcoin and Ethereum. According to the report, Solana has solidified its position alongside Bitcoin and Ethereum as part of crypto’s “Big Three.” As such, speculation about its potential for a spot at ETF has been opened and is thriving. Current regulatory frameworks present certain obstacles to new crypto ETFs, and the development of political dynamics alongside these frameworks is likely to affect how such offerings could come to fruition. Two key factors for the next crypto ETFs The report from GSR highlights two key factors determining the next spot digital asset ETF: decentralization and potential demand. Solana performs well in both categories, scoring above average in decentralization metrics such as the Nakamoto Coefficient, staking requirements, and governance ratings. Decentralization is becoming increasingly important in regulatory considerations, with the FIT21 bill and SEC guidance suggesting that “sufficiently decentralized” assets may be viewed more favorably. This focus on decentralization could significantly influence which projects become eligible for ETF approval. Measuring decentralization, however, is complex and multifaceted. Key metrics include the Nakamoto Coefficient, which assesses network resilience against collusion, and staking requirements, which indicate how accessible network participation is. This formulation serves as a quantitative method for determining a network’s degree of decentralization. Former Coinbase CTO and a16z GP Balaji Srinivasan defines the “minimum” Nakamoto Coefficient as a “simple, quantitative measure of a system’s decentralization, motivated by the well-known Gini coefficient and Lorenz curve.” Governance ratings also play a…

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Filed under: News - @ June 28, 2024 7:16 pm