SOL coin price prediction for 2025: Will Solana threaten crypto’s big two?

SOL has higher transaction speeds and lower fees, but is it enough to overtake ETH?

Contents

Solana launched in 2020 with the goal of overtaking the top cryptocurrencies and becoming the go-to blockchain. Out of all of the 8,000-plus  cryptocurrencies in existence, solana is the one of the few that is most likely to dethrone both ether (ETH) and bitcoin (BTC) – but they will not go down without a fight.

Ethereum has proved time and again that it is a secure blockchain, while Solana has experienced growing pains when managing its security. However, Ethereum is not faultless, and transaction speeds and fees make Solana a favourable alternative.

The recent bear market has further taken a toll on ETH. But has Solana missed its chance to exploit that opportunity?

What is Solana?

Anatoly Yakovenko, who is based in San Francisco, designed the Solana blockchain as an Ethereum alternative. Many of the same tasks can be built on his platform, whether that is programming smart contracts, creating decentralised applications (dApps) or minting non-fungible tokens (NFTs).

Solana does have one difference, however: it was created with scalability at its core, through its quicker transaction speeds and lower fees. The blockchain also uses Rust, a different programming language from Ethereum. Rust is used by technology giants including Facebook and Amazon, giving Solana access to a wider community of developers.

The advantages of Solana gained attention this year, and the price of its native cryptocurrency (SOL) surged. Many are calling it an “Ethereum killer,” as it has the potential to threaten the top two cryptocurrencies.

Is SOL next in line to the throne?

Solana’s cryptocurrency, SOL, launched on 11 April 2020 at $0.95. For the rest of the year, it struggled to get past the $5 barrier.

In 2021, the market proved to be much more bullish for the cryptocurrency, as it climbed past $40 in May. The upward trend did not stop there: SOL skyrocketed to $100 in September, and on 6 November it reached its all-time high of $260.

This all-time high was partly down to the bullish crypto market at the time, which saw ETH and BTC break new records. It was also influenced by the launch of Solana Ventures, a firm that plans on investing $100m (€88.3m, £74.6m) into the gaming and technology sectors.

After reaching its all-time high, SOL became the fourth-largest cryptocurrency by market capitalisation, pushing tether (USDT) into fifth and cardano (ADA) into sixth.

But Solana has since had a dismal start to the year, with its price plummeting in Q1 of 2022. SOL is currently down over 70% from its November price record, with the cryptocurrency sitting just above $70. This has led its market capitalisation to fall out of contention with the big two. It is now sitting at number seven, behind XRP, USD coin, BNB and tether.

The reality is that SOL is still far behind even competing for the number three position, let alone being capable of dethroning ether or bitcoin. Its market capitalisation is only $24bn, which is less than 50% of BNB’s and under 40% of USDT’s.

Can SOL take on the big two?

While its market capitalisation is far behind, solana still has advantages over ether and bitcoin. The Solana blockchain uses a proof-of-history (PoH) and proof-of-stake (PoS) model. PoS requires a validator to verify a transaction, which is determined by the number of coins they hold.

Solana has implemented PoH into its verification process. PoH creates timestamps that reflect the amount of SOL held and when it was held. The combination of the two protocols has given Solana much faster transaction speeds compared to the top two cryptos.

Both ETH and BTC use a proof-of-work (PoW) system. This means validators have to complete complex puzzles to create a new block. PoW is designed to take a long time, as the puzzles need to be complicated to stop a flurry of new blocks from flooding the system.

The fastest blockchain on the block?

While Ethereum can handle roughly 13 transactions per second (TPS) and Bitcoin can manage about five TPS, Solana is staggeringly higher, with 50,000 TPS. Solana’s network speed is even quicker than the global payment processor Visa, which has approximately 24,000 TPS.

Their slowness is causing massive growing pains for Bitcoin and Ethereum that will halt their scalability. For BTC to remain the go-to transactional currency, it is going to need to manage lots of people using the network, and therefore many more TPS.

Similarly, for Ethereum to attract a wider user base to use its applications and smart contracts, it will need to be able process high transaction speeds. The current low speeds are also unappealing as they drive up network fees. Ethereum gas fees, which are needed to complete a transaction, are priced by supply and demand. The more transactions on the network, the higher the gas fees.

As Solana can handle more transactions, its fees are much lower. Gas prices on Ethereum can range dramatically, from $20 to more than $100. Solana’s transaction fees are priced at $0.00025, which in itself is a compelling reason to ditch Ethereum and migrate to this alternative.

Ethereum 2.0

Ethereum has noted its scalability problems and is attempting to fix them by switching its consensus mechanism. Next year, Ethereum will migrate to PoS in an attempt to drive down gas fees and increase transaction speeds.

What is your sentiment on SOL/USD?

43.9092
Bullish
or
Bearish
Vote to see community's results!

This should give it higher processing power than Bitcoin, but Ethereum will still struggle to catch up to Solana, which does not need to wait for confirmation across the network. PoH forms a record that proves the details of an event, while traditional PoS needs validators to communicate with each other.  

Despite this, Ethereum’s co-founder, Vitalik Buterin, says the blockchain could reach 100,000 TPS after the upgrade. But this remains to be seen. 

Security threats

Although Solana has logistical advantages over the big two cryptocurrency blockchains, it is nowhere near as trusted.

Bitcoin’s blockchain has never been successfully hacked or maliciously attacked. Programs built on Ethereum have had some security hiccups, but it was never the fault of the actual blockchain. As Solana is a newcomer, it has not yet earned that trust. More importantly, it has proved vulnerable to malicious attacks on its blockchain.

In September, Solana went down for 17 hours after an attack that flooded the network with bots. This was too much for the blockchain to handle, and the attack left it unable to create new blocks.

Solana’s network going down was not an isolated incident. In December 2021, a bug was found in the Solana Protocol Library – the documents that guide Solana projects. This bug could have been exploited to steal money from Solana projects at a rate of $27m an hour.

While the blockchain may be scalable in theory, in practice it is a different story. So before it is to take on the big two, it needs to prove itself as a trusted network.

SOL coin price prediction 2025: higher than ETH and BTC?

SOL has a strong future, according to Solana price predictions. However, at the moment, it is unlikely to threaten either ETH or BTC.

AMB Crypto writer Sahana Venugopal recently noted that the altcoin’s trading volume has been surpassing bitcoin’s as SOL has been able to capitalise on the recent losses of the big two. It has also been able to compete with Ethereum’s NFT market.

She wrote: “Solana has an ace up its own sleeve. To be specific, this is Solana’s growing influence in the NFT space as it tries to outpace Ethereum.”

A newly released performance report by Messari acknowledged the growth in Solana’s NFT markets. However it confirmed Solana’s difficult year as well and said: “Solana also experienced network performance challenges and declines in financial performance.”

Nigel Frith, an equities trader at AskTraders, argues that Solana has room for growth, but will not dethrone Ethereum. He said: “I believe Ethereum 2.0 will continue to dominate the current crypto markets as the most widely used blockchain.

“That doesn’t mean blockchains like Solana will not thrive as well. Solana already provides a great solution: it has a lower transaction fees than what ETH can offer currently, as well as the fastest transaction speeds.”

This verdict that Solana can grow, but not as quickly as ether or bitcoin, is largely reflected by experts making a SOL coin price prediction for 2025.

WalletInvestor’s SOL coin price prediction says it will hit $282 by the end of 2025. This is much lower than ETH’s $9,779 and BTC’s $109,275

CoinPriceForecast predicts that SOL will only reach $282. Its Solana price prediction for 2025 is lower than ether’s $6,720 and bitcoin’s $91,575.

A more bullish outlook is given by Gov.capital, whose SOL price prediction for 2025 estimates it will surpass $1,600. However, this is not as high as the 2025 forecasted price of ether that is above $10,000, or the prediction for bitcoin that is higher than $165,000.

The Solana coin price prediction for 2025 from DigitalCoinPrice is less optimistic, forecasting that the so-called “Ethereum killer” will only reach $135.67. This is nowhere near the forecasts for the top two: DigitalCoinPrice predicts BTC will climb to $63,705 and it expects ETH to climb past to the $4,500 mark.

FAQs

It could be. Solana is a blockchain that allows developers to build apps and smart contracts with low fees and high transaction speeds.

However, with Ethereum’s upgrade this year, Solana may lose its selling point. You should always do your own research before investing.

It depends. The consensus of SOL price predictions argues that the coin will be on a long-term bullish run. Gov.capital predicts it can surge to $1,500 by 2025, but others – such as CoinPriceForecast, which estimates it will only reach $281 by 2025 – are less optimistic.

Remember, prices can go up as well as down, and you should never invest more than you can afford to lose.

Whether you decide to invest in Solana is up to you. With its lower fees and higher transaction speeds, SOL offers an attractive alternative to ETH, but bear in mind that most price predictions do not expect the new crypto on the block to surpass either bitcoin or ether any time soon.

However, price predictions are not always right, so you should always do your own research before investing.

Further reading

The material provided on this website is for information purposes only and should not be regarded as investment research or investment advice. Any opinion that may be provided on this page is a subjective point of view of the author and does not constitute a recommendation by Currency Com Bel LLC or its partners. We do not make any endorsements or warranty on the accuracy or completeness of the information that is provided on this page. By relying on the information on this page, you acknowledge that you are acting knowingly and independently and that you accept all the risks involved.
iPhone Image
Trade the world’s top tokenised stocks, indices, commodities and currencies with the help of crypto or fiat
iMac Image
Trade the world’s top tokenised stocks, indices, commodities and currencies with the help of crypto or fiat
iMac Image