Grayscale Solana Trust Trading At A Mega 650% Premium: What’s Going On?

Solana is in red for now, however the coin is one in all the highest performers. Within the last 12 months of trading, SOL, the native currency of the Solana ecosystem, rose by over 15X, quickly moving up the crypto rating to fifth, flipping XRP, Cardano, and even top meme coins like Dogecoin.

GSOL Trading At A 650% Premium

There could possibly be more for SOL in the approaching few weeks. Data shows that the Grayscale Solana Trust (GSOL) is trading at a 650% Net Asset Value (NAV) premium.

Based on Jamie Coutts, the Chief Crypto Analyst at Real Vision, the spike within the NAV premium follows the wave of spot Solana exchange-traded funds (ETFs) in america and Canada.

GSOL trading at a premium | Source: @Jamie1Coutts via X

To grasp what’s happening, the GSOL NAV generally represents the overall value of all SOL held by the trust, divided by the variety of outstanding GSOL shares. If GSOL trades higher or lower than the NAV, it could be selling at a reduction or an enormous premium.

When GSOL trades higher than the NAV, it is obtainable at a premium, meaning individuals are willing to pay higher for the underlying asset, on this case, SOL.

GSOL is now available at a premium partly due to the limited supply. Only a couple of shares are listed for trading, unlike the free trading SOL available on multiple crypto exchanges like Binance or Coinbase.

Accordingly, institutions, expecting prices to spike in the approaching months, might need to scramble with others to get exposure to SOL via GSOL, driving premiums higher.

Eyes On Spot Solana ETF Applications In The US And Canada

Anticipation is high that Solana might outperform Bitcoin and Ethereum in the approaching months, stretching gains of Q1 2024. The preview follows the choice by VanEck and 21Shares to file for spot Solana exchange-traded funds (ETFs) with america Securities and Exchange Commission (SEC) in late June.

Of their filing, VanEck, through its Head of Digital Assets Research, Matthew Sigel, said their product will aim to make the most of Solana’s decentralization, utility, and economic viability. The manager also added that SOL qualifies to be a commodity like Bitcoin.

Solana price trending lower on the daily chart | Source: SOLUSDT on Binance, TradingView
Solana price trending lower on the every day chart | Source: SOLUSDT on Binance, TradingView

Even with this application, the percentages of the spot Solana ETF being approved by the strict agency remain slim. Unlike Bitcoin and Ethereum, whose futures products can be found on CME, SOL shouldn’t be listed on the bourse. At the identical time, america SEC cited SOL as one in all the multiple unregistered securities once they sued Binance and Coinbase.

Feature image from Canva, chart from TradingView

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