The crypto world often feels like a high-stakes poker game, with fortunes rising and falling faster than a meme coin on a Monday morning. Lately, one of the biggest players just showed their hand, and it seems they are all in on Solana.
- Pantera Capital, led by Dan Morehead, has made Solana its largest crypto holding, representing 23% of its $4.7 billion in assets under management.
- Morehead believes the blockchain market will not be a winner-take-all scenario, predicting a “single-digit number of Layer 1s” will survive long-term, including Bitcoin, Ethereum, and Solana.
- Pantera is also facilitating easier access to crypto for “normal investors” through a new product that allows brokerage account purchases, aiming to bridge the gap for assets like Solana which lack ETFs.
Dan Morehead, the founder of Pantera Capital, a venture capital firm with some serious crypto clout, recently pulled back the curtain on his firm’s holdings. He told Andrew Sorkin on CNBC’s “Squawk Box” that Solana is now Pantera’s single largest crypto position.
We are talking about a hefty sum here. Pantera holds a staggering $1.1 billion worth of Solana on its books. That is roughly 23 percent of the firm’s total $4.7 billion in assets under management. It is a significant bet, to say the least.
Morehead was asked if the blockchain market is a winner-take-all scenario. He quickly dismissed the idea. “No, it isn’t,” he stated. He drew a parallel to the internet itself, noting that many companies thrive there, not just one.
He believes the same will hold true for blockchains. “There will be lots of blockchains that are important,” Morehead explained. But he made it clear where Pantera’s biggest conviction lies right now.
Sorkin pressed him on the number of protocols that might survive long term. Morehead predicted a “single-digit number of Layer 1s,” listing Bitcoin, Ethereum, and Solana as examples. He sees a future with a few key players, not thousands, but certainly not just one.
This big bet on Solana is interesting, especially when we look back a few months. In May 2024, Pantera announced what it called its “largest-ever investment” in TON, the native cryptocurrency of the TON blockchain. TON is closely linked to the messaging giant Telegram.
The exact amount of that TON investment was not disclosed. However, the mini-game hype cycle around Telegram and TON blockchain faded shortly after. Since then, TON has seen its value drop by around 60 percent, according to price data from The Block.
When asked about better crypto technologies emerging, Morehead was direct. “Well, right now it’s Solana,” he said. He acknowledged Pantera’s past large positions in Ethereum and even being “100% Bitcoin” once upon a time. But for today, Solana holds the crown.
He highlighted Solana’s impressive technical capabilities. “Solana can do 9 billion transactions a day, which is more than all capital markets combined,” Morehead pointed out. With that kind of horsepower, he suggested, the need for “that next thing past Solana” is not immediately obvious.
Looking at long-term price action, Morehead still sees significant upside for Bitcoin. He noted that Bitcoin remains a small fraction of global wealth. He anticipates it could reach $750,000 in the next four or five years.
However, he believes Solana is poised to outperform Bitcoin over time. Why? Solana’s market capitalization is currently only about 5 percent of Bitcoin’s. This suggests a larger runway for growth in his view.
Pantera is not just making direct investments. Earlier on the same Monday, the firm announced it was leading a private investment in public equity (PIPE) offering. This was alongside Summer Capital for Helius Medical Technologies.
The goal of this $500 million raise is to launch a Solana treasury company. The news sent Helius Medical Technologies, a Nasdaq-listed micro-cap firm, soaring. Its stock jumped 142 percent by Monday’s close.
Morehead explained the significance of this new product. “For 12 years, we’ve been trying to provide access, but it’s normally to very institutional investors,” he told Sorkin. This Helius offering changes that.
“This is the first product we’ve ever offered that you can just go buy at your brokerage account,” Morehead stated. This move aims to provide “normal investors” with easier access to cryptocurrencies.
He specifically mentioned Solana. “Solana doesn’t even have an ETF,” he noted. This makes it “very, very difficult for a normal investor to get access to Solana.” The Helius product seeks to bridge that gap.
The Broader Market View
While Pantera places its chips, other market watchers offer a wider lens. Later that day, Tom Lee, Managing Partner at Fundstrat and Chair of Ethereum treasury firm BitMine, shared his thoughts on CNBC’s “Closing Bell.”
Lee spoke with Dominic Chu, outlining his expectations for the crypto market. He believes that if the Federal Reserve cuts interest rates as anticipated, Bitcoin and Ethereum will be the biggest crypto beneficiaries. They would join the Nasdaq 100 and small-cap stocks in leading the charge.
He described the current bull market as “mid-cycle.” Lee suggested that the next leg of this rally hinges on a few key factors. The Fed needs to cut rates, the ISM manufacturing index needs to climb back above 50 (a level it has not seen in 31 months), and mortgage rates need to come down.
This is especially true, he added, in an environment where the labor market has shown signs of slowing. It is a delicate balance, and the Fed’s actions loom large over everything.
Lee looked to history for a playbook. “I’m looking at September 98 and September 2024 as the playbook,” he said. Both years, he explained, saw the Fed on an extended pause, followed by rate cuts in September. He sees a pattern emerging.
He outlined his top trades for this scenario. “The number one trade is NASDAQ 100,” Lee declared. This is why he believes the “MAG-7” (the Magnificent Seven tech stocks) and the AI trade will get “a lot of liftoff.”
The second trade, he noted, is tied to “monetary liquidity sensitivity.” This refers to global central banks easing their policies. “That’s Bitcoin and Ethereum,” Lee explained. He expects them to make “a monster move in the next three months, like, huge.”
His third category involved “interest rate sensitives,” which include small caps and financials. However, he emphasized that the first two, the NASDAQ 100 and the liquidity-sensitive cryptos, might be the standout trades.
Lee elaborated on the drivers for the two major cryptocurrencies. Bitcoin, he said, primarily reacts to monetary policy and overall liquidity in the system. It is a barometer for the flow of capital.
Ethereum, on the other hand, is both liquidity-sensitive and connected to broader innovation. This includes advancements in artificial intelligence (AI), increasing Wall Street adoption, and the growth of stablecoins (cryptocurrencies designed to maintain a stable value).
He likened Ethereum to the post-1971 dollar era, calling it a “growth protocol.” This perspective explains why BitMine, the Ethereum treasury firm Lee chairs, is heavily accumulating it. Their holdings have grown to 2.15 million ETH.
So, while some big players are making concentrated bets on specific protocols like Solana, others are watching the broader economic currents. The question remains: will the Fed’s next move unleash the “monster move” Tom Lee predicts, or will Solana’s raw transaction power continue to turn heads?
