Solana (SOL) Might Hit $520 This Year, VanEck Predicts

Solana (SOL) has seen its value drop 2.04% in the past 24 hours and is currently changing hands at $198. Over the last week, the token has dropped 16.1%

Solana (CRYPTO: SOL) has seen its value drop 2.04% in the past 24 hours and is currently changing hands at $198.

Over the last week, the token has dropped 16.1%, but its monthly chart shows a 0.85% gain.

The hourly chart also reflects a $1.76 gain, indicating that the token might be on a slow but steady resurgence path.

VanEck’s Bold $520 Price Prediction

SOL’s recovery comes as investment firm VanEck makes a bold prediction that the token will hit $520 before the end of the year. This prediction is based on two main factors: expectations of a blowing up M2 money supply over the next few months and increasing demand for smart contract platforms (SCP).

To clarify, M2 money supply refers to the total amount of money in circulation within the US economy at any given time. This monetary metric, which includes cash and checking deposits, usually affects the crypto market in a way that when it increases, the prices of Bitcoin and other risk assets, like SOL, also tend to go up.

That is because an expanding money supply tends to trigger inflation, in which case Bitcoin and its cohorts become more attractive, driving up their demand and prices. The reverse is the case when the M2 money supply decreases, as the crypto market usually suffers the same fate.

For now, though, VanEck is expecting the M2 money supply to grow by over 3% within this year. That is, from its current state of $21.5 trillion to $22.3 trillion by the year’s end.

When it comes to the SCP market, where Solana and other similar platforms facilitate the creation and execution of smart contracts, VanEck has a bigger expectation. According to the investment firm, this market could see a 43% growth within the year to reach $1.1 trillion.

Presently, Solana commands 15% of the SCP market, but even that could grow to 22%, VanEck projects.

Potential Catalyst: Grayscale’s Solana ETF Filing

It might be crucial to note that a new development could contribute to these positive predictions regarding Solana’s SOL token. On Thursday, the U.S. SEC, which has previously failed to acknowledge several applications for a Solana ETF, admitted receiving a filing by Grayscale for its SOL ETF.

While this does not guarantee that the commission will approve or deny the application, the acknowledgment, at least, indicates progress for the institutional adoption of SOL.

Although this development has failed to have an immediate impact on price, it sure looks likely to contribute to a stronger long-term outlook for Solana, alongside VanEck’s projections.