VanEck has forecasted that Solana’s SOL token could reach $520 by the close of 2025, driven by an increase in the M2 money supply and growing demand for smart contract platforms (SCPs).

The M2 money supply is an economic indicator that measures the amount of money circulating in the U.S. economy, including cash, checking accounts, and near-money assets like savings accounts and money market funds. VanEck predicts M2 will rise to $22.3 trillion by 2025, from its current value of $21.5 trillion. This expansion of the money supply is expected to bring more liquidity into the market, which would likely boost investments in risk assets, including cryptocurrencies.

The market for smart contract platforms like Solana is expected to grow by 43% to reach $1.1 trillion by the end of 2025. Solana, which currently holds about 15% of this market, is projected to increase its share to 22% by the end of the year, according to VanEck’s analysis.

“We project Solana’s market share to rise to 22% by the end of 2025,” VanEck said in its report. “This projection is supported by Solana’s dominance in developer activity, increasing decentralized exchange (DEX) volumes, and rising active users.”

Using an autoregressive (AR) model, VanEck estimates that Solana’s market cap could grow to approximately $250 billion, translating to a SOL price of around $520, based on the estimated circulation of 486 million tokens.

VanEck is also one of the U.S.-based firms that applied for a Solana ETF in 2024. While the U.S. Securities and Exchange Commission (SEC) had previously rejected ETF applications tracking SOL, it recently accepted Grayscale’s filing for a Solana ETF, suggesting a decision may be made by October.