Morgan Stanley Spot ETF Proposal Revives Hope for Solana Price Momentum

Solana's price has been struggling to hold above $90, but there are signs that a proposed spot ETF by Morgan Stanley could bring fresh momentum to the token. The fund would allow institutional investors to invest in Solana, potentially opening access to new pools of capital.

According to data from Coingecko, Solana's price briefly climbed to nearly $93 on May 15 before losing momentum again. The token has been facing resistance at the $94 to $96 range, and its trading activity has slowed compared to the frenzy seen during the memecoin boom that fueled much of the chain's growth.

The proposed Morgan Stanley spot SOL ETF would operate differently than earlier crypto ETFs, as it would stake up to 100% of its Solana holdings through third-party staking providers. This mechanism could turn the ETF into a yield-generating investment product while simultaneously reducing the liquid SOL supply available on the open market.

Analysts following the proposal say that if large quantities of tokens become locked through institutional staking activity, the resulting supply compression could help absorb overhead selling pressure that has repeatedly capped Solana's price in recent weeks. However, the token still faces significant resistance and its price is vulnerable to a retest of support zones if market conditions deteriorate.