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Grayscale Launches Solana Trust For Institutional and High Net Worth Investors

2 mins
Updated by Ryan James
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In Brief

  • Digital Currency Group's Grayscale Investments launches Grayscale Solana Trust.
  • Solana has seen an increase of over 10,000% to date.
  • Solana is growing in popularity with respect to NFT sales and dApp development.
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Grayscale, the world’s largest asset manager for digital currency, has added Solana to its portfolio for institutional investors and high net-worth individuals.

Grayscale Investments has created a new product with exposure to Solana for high net worth individuals and institutional investments. The Grayscale Solana Trust product becomes the sixteenth product in Grayscale’s product portfolio, after the Grayscale Bitcoin Trust, the Grayscale Basic Attention Token Trust, the Grayscale Bitcoin Cash Trust,  the Grayscale Chainlink Trust, the Grayscale Decentraland Trust, and the Grayscale Ethereum Trust, amongst others. A minimum investment of $25000 is required, together with an annual fee of 2.5%. The launch of this new product is occurring after the SOL token was added to the Grayscale Digital Large Cap Fund in Oct 2021.

Solana’s high transaction speed and low cost bringing in developers

 Solana is a smart-contract-based blockchain that was introduced in 2017. It uses Proof-of-History as a blockchain consensus mechanism. Transactions occur much faster than Ethereum, with 50000 to 65000 transactions per second, compared to 15-30 transactions per second for Ethereum. It also beats Cardano, which does 250 transactions per second. The cost of doing transactions on Solana is $0.00001 to $0.00025, compared to $15-$40 per transaction in gas fees on Ethereum.

According to Grayscale CEO Michael Sonnenshein, Solana has over 500 decentralized applications and 1.2 million active users on the network. The low transaction fees have driven developer interest in Solana and bodes well for the future of the blockchain, according to Sonnenshein. Late November saw $14.45B in total-value locked in applications on the network, and 1750 active developers. Some interesting dApps have surfaced on Solana, including a blockchain-based audio streaming service called Audius, which has an audio TOKEN, and boasts 5 million listeners.

NFT collections like the Degenerate Ape Academy have also surfaced on Solana, and data from Cryptoslam places Solana in fourth place with respect to 24-hour NFT sales volumes. Ethereum, Algorand, Cardano, and Polkadot are all competing with Solana to be the network for decentralized finance applications, NFT trading, and blockchain gaming.

Bankman-Fried boosting Solana’s popularity

Solana’s popularity has been boosted by Sam Bankman-Fried’s public endorsements, raising its public profile. The Solana token SOL has the fifth-largest market capitalization of $65B, according to Coingecko. Solana has also seen tremendous growth in 2021; it started at $2 and now sits at a little over $200, increasing over 10000%. It has, however, been subject to some teething problems, like the 17-hour outage experienced in mid-September. The Solana project has had over $2B in venture capital invested in it, with $100M earmarked for Web 3.0 products. Concerning inflows relative to assets under management, Solana has seen $14.6M in inflows or 5.9%, according to a Coinshares report released in late November.

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David Thomas
David Thomas, a seasoned electronic engineer with nine years of expertise, has built a distinguished career by combining his passion for writing with an in-depth understanding of...