The cryptocurrency market is bracing for potential shifts that could significantly influence its trajectory. According to a recent report from Standard Chartered analysts, Solana (SOL) may see substantial gains if Republican candidate Donald Trump secures victory in November. With political dynamics at play, understanding how these developments could affect Solana’s future becomes crucial for investors and enthusiasts alike.

Solana’s Current Standing

Solana has had a remarkable year in the cryptocurrency space. Starting 2024 at approximately $105, it experienced an impressive surge, peaking over $200 in March. Although it has faced some pullback since then, SOL remains up 40% year-to-date, positioning it as one of the standout performers among digital currencies. The outlook for Q4 seems optimistic, especially given recent analyses suggesting it could outpace larger rivals like Bitcoin (BTC) and Ethereum (ETH) under a Trump administration.

Analyst Insights

The report from Standard Chartered, led by Geoffrey Kendrick, the bank’s global head of digital assets research, expresses a bullish sentiment for Solana. The analysts predict that SOL could achieve a remarkable five-fold increase by the end of 2025, fueled by a more favorable regulatory landscape anticipated under Trump. They suggest that a Republican win may lead to more supportive policies for cryptocurrencies, setting the stage for Solana’s growth.

Conversely, if Vice President Kamala Harris were to ascend to the presidency, the analysts foresee SOL trailing behind BTC and ETH. The reason? Both Bitcoin and Ethereum have established infrastructures and enjoy significant institutional backing, which may enable them to navigate a stricter regulatory environment more effectively.

Political Climate and Cryptocurrency

The potential impact of U.S. elections on the cryptocurrency market cannot be understated. Analysts believe that the regulatory approach adopted by the incoming administration will play a pivotal role in shaping the performance of various cryptocurrencies. For instance, under a Trump presidency, the anticipated regulatory friendliness could encourage more investment in Solana and similar altcoins.

On the other hand, a Harris presidency might create challenges for lesser-known cryptocurrencies, including SOL, which could experience reduced traction in the market. This divergence highlights the importance of political developments in determining the investment landscape for cryptocurrencies.

Mixed Fundamental Indicators

While political factors could influence Solana’s price trajectory, on-chain metrics present a more nuanced picture. Recent data from The Block’s Solana dashboard reveals that the network witnessed an impressive 99.76 million new monthly addresses in September—a record high. However, a closer look at the numbers reveals some troubling trends. According to data from Sol scan Explorer, the number of active wallets on the network has seen a decline in recent weeks, dropping from a peak of over 5 million in early September.

Additionally, the trend in new account creation has also been downward over the past two months. This juxtaposition raises important questions about the sustainability of Solana’s recent growth. If the influx of new addresses does not correlate with increased activity, it could signal waning demand among market participants.

Transaction Trends on the Rise

Further compounding the concerns is the decline in daily non-vote transactions on the Solana network. After hitting a peak of approximately 46.11 million on July 16, the daily transaction count has remained below 40 million since early August. This trend mirrors the overall slowdown in network activity, despite the earlier surge in new addresses.

Investors and analysts will need to keep a close eye on these metrics as they can offer insights into Solana’s ongoing health and potential for growth. The recent drop in transactions indicates that while new users may be joining the network, they are not necessarily becoming active participants.

Technical Analysis of SOL

At the time of writing, Solana was trading at around $143, maintaining a relatively narrow range between $120 and $162 since early August. A detailed examination of Trading View’s SOL/USDT chart reveals that the price has been forming a pennant pattern for nine months. This unique formation suggests that a significant price movement may be on the horizon, especially as the market approaches the final quarter of the year.

Traders and investors might look for breakout signals in the coming weeks, particularly as political developments unfold. The volatility surrounding elections often leads to increased trading activity, which could influence Solana’s price dynamics.

Conclusion

As the U.S. elections draw nearer, the implications for the cryptocurrency market, particularly for Solana, are significant. With analysts predicting a bullish scenario for SOL under a Trump administration, investors should remain vigilant. However, the mixed indicators regarding network activity and transactions suggest that potential investors should proceed with caution.

Understanding the intersection of politics and cryptocurrency will be essential for navigating the market in Q4 and beyond. Whether Solana can sustain its momentum and outperform its larger rivals remains to be seen, but the upcoming election could very well be a turning point in its trajectory.