Jonathan Gray
A widely followed analyst is leaning bullish on Solana (SOL) over the long term amid an upcoming upgrade.
In a new video, the analyst pseudonymously known as InvestAnswers tells his 563,000 YouTube subscribers that a proposal to reduce Solana’s inflation rate by around 80% at the end of Epoch 755 heightens Solana’s bullish prospects.
An Epoch is a fixed period during which certain network activities such as governance matters, protocol upgrades, and other related matters are decided and executed.
At the same time, InvestAnswers says the bullish thesis for the sixth-largest crypto asset by market cap is further improved if the U.S. Securities and Exchange Commission (SEC) approves a spot Solana exchange-traded fund (ETF).
“…they’re coming up with this vote to reduce inflation on Solana, which currently is not that bad at all. But that will reduce inflation from about 4.8% down to about 0.86% inflation.
If it passes, if it passes and it’s looking possible that it might… the voting ends at the end of Epoch 755… if this does happen, all of a sudden Solana becomes the hardest layer-one asset.
Remember, Bitcoin inflation is 0.85%. Solana’s, if this passes, will be 0.86%.
And my question is, what happens if a Solana ETF comes? I mean, so much is staked. There’s very little on exchanges. We could see a crazy pump.”
On the reduced staking rewards, the proposal to cut Solana’s inflation rate is likely to have, InvestAnswers says,
“People say, ‘well, if inflation goes down, won’t my staking rewards go down?’ Well, the math of it is your price appreciation will far exceed your staking rewards.
So please think price appreciation – do you want an asset to go from $120 to $240 or do you want an asset to stay at $120 and get 6% or 8% per year. The answer is you want it to double. That will impact price appreciation more.”
Solana is trading at $126 at time of writing.
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