Solely two cryptocurrencies have ever reached a market cap of $500 billion: Bitcoin (BTC -2.20%) and Ethereum (ETH 1.61%). Most are nowhere close to that milestone, however contemplating how a lot the crypto market has grown, different cash may get there ahead of you’d suppose.
In 5 years’ time, I anticipate Solana (SOL -2.55%) to have surpassed $500 billion. It is the fifth-largest cryptocurrency on the time of this writing (July 21) and has a market cap of about $109 billion. It might want to achieve practically 360%, however with the know-how behind it and a rising consumer base, Solana is prepared for a critical bull run.
Picture supply: Getty Pictures.
All of it begins with efficiency
There isn’t any scarcity of blockchain platforms with good contract performance, the place builders can construct decentralized apps (dApps) and launch new crypto tokens. Solana’s calling card has all the time been that it is a high-performance blockchain able to quicker transaction processing than the competitors.
That was the case when Solana launched in 2020, and it is nonetheless the case right this moment. Listed below are the 5 quickest blockchains by transactions per second (TPS) in keeping with Chainspect information from July 21.
|
Blockchain |
Actual-Time TPS (July 21) |
Max Theoretical TPS |
|---|---|---|
|
Solana |
1,505 |
65,000 |
|
ICP |
1,160 |
209,708 |
|
BNB |
114 |
2,222 |
|
Stellar |
106 |
2,032 |
|
Base |
100 |
1,429 |
Information supply: Chainspect (July 21, 2025)
Solana’s largest competitor, Ethereum, ranked No. 16 with 21 TPS and a theoretical max of 119 TPS.
Transaction charges on Solana are additionally extraordinarily low, presently costing lower than $0.005. Though it is vital for blockchains to have low transaction prices, this is not a distinguishing issue like Solana’s processing pace. Different blockchains have achieved equally low cost charges.
However how does Solana outperform each different blockchain at processing transactions? Like many different blockchains, Solana makes use of a proof-of-stake validation method, the place transactions are accepted by validators who’ve staked their SOL tokens. Solana combines proof of stake with its personal distinctive innovation, proof of historical past, that provides timestamps to blocks of transactions. With this additional piece of knowledge, it is attainable to validate transactions a lot quicker.
Cryptocurrency values are largely tied to the variety of folks utilizing their blockchains. Solana’s pace provides it a aggressive benefit over different blockchains, and we’re seeing the outcomes in a number of notable areas just lately.
Builders, DeFi, and real-world belongings
One method to achieve perception into the expansion potential of a blockchain is to trace the variety of builders it has. The Solana Digital Machine (SVM) has 1,030 full-time builders, that means builders who dedicated code a minimum of 10 days out of the month, in keeping with Electrical Capital. It is second behind Ethereum, which has 3,835.
Nevertheless, these two blockchains are transferring in reverse instructions. Solana’s full-time developer rely has elevated by 21% in the final 12 months, whereas Ethereum’s has fallen by 16%. Solana was additionally the highest ecosystem for brand spanking new builders in 2024.
One other space the place Solana has been rising quickly is in decentralized finance (DeFi) services. During the last 12 months, the full worth locked (TVL) into DeFi purposes on Solana has greater than doubled, from $5.1 billion to $10.5 billion, in keeping with DeFiLlama. It is also the No. 1 blockchain with $192.6 million in app income during the last 30 days, an indicator of excessive exercise on Solana.
There’s one new a part of DeFi, in specific, that could possibly be an enormous tailwind for Solana: tokenized real-world belongings (RWA). These are digital tokens representing actual monetary belongings, most frequently shares which are reportedly backed 1-to-1 by precise shares. So, traders can now make investments in tokenized shares of Tesla, Nvidia, and dozens of different popular stocks on Solana.
We’re nonetheless in the early phases of tokenized RWA, with the full worth on Solana presently sitting at $536 million. Extra spectacular is that Solana already has over 60,000 RWA holders, and the quantity has gone up by 729% during the last 30 days.
Favorable market situations may ship Solana hovering
Cryptocurrency has by no means been extra mainstream. The White Home introduced the creation of the U.S. Digital Asset Stockpile in March, and Solana is among the cryptocurrencies President Trump has urged for inclusion. The U.S. handed the Genius Act, the primary main crypto laws, earlier this month.
Investing in Solana may get even simpler, too. Prediction markets put the chances of the primary spot Solana ETF approval this 12 months at 99%. Bitcoin ETFs, which had been accepted in January 2024, have already acquired about $55 billion in inflows so far. Ethereum ETFs, first accepted in July 2024, are at practically $8 billion.
I feel all the things’s lining up for Solana to take off and attain $500 billion in worth. It has a powerful basis, spectacular development numbers, and ETF approval may convey in extra institutional traders. A 360% return in 5 years is lofty, however actually not unrealistic for a cryptocurrency. Bitcoin has executed higher than that over simply the final three years.
That stated, the crypto market, together with Solana, is dangerous. Despite the fact that I am bullish on Solana, it nonetheless solely makes up a small a part of my investments, and I would advocate retaining most of your cash in safer belongings.
